OptionTrader. Amazingly Accurate New Mechanical Options Strategies! Plus: The NEW Visual Volatility Tool. NEW Harnessing the Power of Options Course

Transcription

1 Nirvana s OptionTrader Amazingly Accurate New Mechanical Options Strategies! Plus: The NEW Visual Volatility Tool NEW Harnessing the Power of Options Course Ed Downs Will Teach You How To: Maximize Profits: Directional Option Trading Generate Income: Income Producing Strategies pgs Weeks of Options Trading with Ed Himself! Live in the Market Option Trading Starts May 12th. Learn how to: Sell Covered Calls The Option Ladder Buy-Writes And More!

2 Discover the Power of Options - with OptionTrader Ed Downs CEO and Founder, Nirvana Systems, Inc. Since I founded Nirvana in 1987, my team and I have primarily been focused on building systems and tools for trading stocks and futures. But in seminars and correspondence over the years, users were continually asking me, When are you going to create an options program? When I asked them, How do you identify an option trade now? the vast majority said, From a Trading Signal on the underlying stock! That s when I realized we already had the perfect options platforms in OmniTrader and VisualTrader. We just needed an easy way for people to trade options on their Signals. OptionTrader is based on the novel concept of using chart levels to determine the best options to trade. Given a Profit and Loss Target, the software will automatically evaluate every option trading method using current option pricing to show you which option trades will make the most money with the least risk. Then, you simply place the trade right in the chart. What could be easier? As far as I know, OptionTrader is also the only program that lets you automatically test any Trading Strategy on popular options methods across a portfolio of symbols. It s how we developed the mechanical Strategies that are in OptionTrader 3. Introducing OptionTrader 3 Today we are releasing OptionTrader 3. This new version has several important improvements, including four new mechanical Strategies that show much better performance than equivalent non-option Strategies. Read about them on pages 6-7. We also added the Visual Volatility Tool, a 3D image of volatility across all option contracts on a symbol. With it, you will see which contracts are expensive or under-priced relative to the market. One glance before placing a trade could keep you from paying too much, or help you identify situations where selling Premium has a high probability of generating income. I have been doing extensive testing in the VisualTrader Simulator on two different approaches to trading options Directional Strategies and Income Producing Strategies. Harnessing the Power of Options with OptionTrader 3 is a new course in which I cover each of these topics in detail. It s not just about option trading. I cover the entire process from scanning for candidates and generating Signals to using OptionTrader 3 to trade the opportunities. LIVE in-the-market Trading Webinars In May 2015, for those who purchase our Ultimate Options Trading Package, I am hosting live, in-themarket options trading webinars twice each week (also recorded) in which we will trade the live market using the concepts taught in the course. In the webinars, we will place trades and monitor our trading progress week by week, discussing what went well in addition to what we could have done better. I m looking forward to demonstrating the profit power of options as we engage the market together! From all my research and trading, it is clear to me that trading options is the best way to engage the market. If you want your option trading to be as easy and profitable as possible, you need OptionTrader 3. Sincerely, Ed Downs CEO and Founder, Nirvana Systems, Inc.

3 The Power of Options! Why trade Options? Options provide the best of all worlds. With options you can: Bigger Profits. Same Risk. An example of how trading options can be more profitable than trading equities with similar risk exposure. Increase Profits Generate Income Limit your Overall Risk Options can dramatically increase trading profits. In the example to the right, we compare the same trades on the stock versus selling options. Profits were nearly three times higher trading options, while losses were about the same. We can also use options to generate income in our accounts, by selling time premium to the market using Covered Calls, Butterflies and other methods. All you have to do is decide which approach to take for a given chart Harnessing the Power of Options with OptionTrader 3 We designed OptionTrader to simplify the option trading process. Given a goal, the software will tell you which option method to apply. How do you know when to generate income vs. placing a directional trade? How do you establish your chart levels? These questions and more are answered in Ed s Course. OptionTrader 3 is the best options trading platform in the world. Combined with the new Options Course, you will be able to engage the options market with confidence. We guarantee it! The Reversal Strategy generated these Signals on Amazon. The table compares trading the Stock vs. selling Puts and Calls. Profits were nearly three times higher trading options, while losses were about the same. This is just one of the eye-opening facts you ll discover in OptionTrader 3. The OptionTrader Advantage Trade Stock Sell Puts & Calls Date Signal Margin %PL Margin %PL 5/12 Long % $ % 6/13 Short % $ % 9/25 Long % $ % 10/15 Long % $ % 10/29 Long % $ % 12/2 Short % $ % 1/22 Long % $ % Option Trading Made Easy... 4 Win in the Options Market with OptionTrader 3 New Options Strategies Maximize Returns... 6 New Strategies and Tools to Supercharge Your Trading Harnessing the Power of Options... 8 A New Course by Ed Downs Ultimate Option Trading Package Bonus Weeks of Options Trading with Ed Downs! 3

4 1 At last... Establish a Target Point Range Dbl Range Trading options is easy with OptionTrader 3. Just place a Target where you think the chart could go and set the Loss Level where you would get out of the trade. In this case, we feel Cisco Systems (CSCO) will likely rally to its prior highs. So, we placed our Profit Target near 30 and the Loss Level halfway to recent support. To get the best answer, we provide three different types of targets Point, Range and Double Target. In our Harnessing the Power of Options with OptionTrader 3 Course, we show you how to establish a Profit Target and Loss level for a variety of different chart situations. Target Loss Level 2 Select the Best Option OptionFinder analyzes all the popular Option Methods using the Target and Loss levels established in Step 1. The upper grid sorts the Option Methods based on profitability. The lower grid shows potential trades within a selected Method, also sorted on profitability. In this example for CSCO, OptionFinder is telling us that Diagonal Spreads have the highest Percentage Gain values over all other Option Methods we might use, based on the given Target and Loss levels we established in the chart. Diagonal Spread has the highest Percentage Gain Top Diagonal Spread trades Now, we can click specific Diagonal Spreads in the lower grid to see the Expiration Graphs and predicted Profit or Loss curves for any point in the future. 4

5 Option Trading Made Easy! 3 Manage the Trade Once you place the trade, you can use the Chart to establish Stop Loss, Profit Target, or Trailing Stop levels for the option position. Stops can be based on Position Value or the value of the Underlying Symbol. And, if you use our integrated brokerage connections, execution of all orders is totally automatic. P&L Curves Expiration Graphs continued from previous page... Short Aug 32 Call, Long Oct 30 Call We note from the % Gain column that the top two trades have nearly the same Profit Potential of about 30%. However, by viewing the Expiration Curves we quickly see that the first trade s profit levels decline significantly at higher prices, while the second trade maintains its profit. This makes the Short Aug 32 Call, Long Oct 29 Call a better candidate. In our Harnessing the Power of Options Course, we go over many examples of using OptionFinder to select the best trades in the live market. Short Aug 32 Call, Long Oct 29 Call Profit holds up at higher prices With OptionFinder it takes just seconds to find the best trade, within the best Option Method for any chart, while it educates you on the merits of each Method. No other option software makes it this easy to select the best Option Method to trade. 5

6 New Options Strategies Maximize Ret New Options Strategies are the perfect starting point for Directional Options Trading. In OptionTrader 3, we are now including FOUR mechanical options trading strategies. The strategies identify points where directional options trading yields a significant advantage. Extended Moves (Debit Spread) Trade on AIG Swing Trade with Options The first two Strategies incorporate options writing approaches to capitalize on the quick moves associated with Swing Trading. Swing Trading (Credit Spread) Swing Trading (Naked Puts) The two Swing Strategies are designed to have a two-fold path to profitability: 1.) They sell options when options prices are high. 2.) They trade to capture the expected swing move in the chart. When you put these two advantages together, you end up with an extremely powerful directional options writing strategy that produces major results 51% Return over the past Two Years UP 146% in Three Weeks! The Extended Moves (Debit Spread) Strategy captures a big gain on AIG. The stock itself moved up 6.6%, but the debit spread picked up 146% in just three weeks. Trade the Extended Move The second two options strategies find slightly longer term trading opportunities, and buy options to increase leverage while limiting risk. Extended Moves (Long Option) Extended Moves (Debit Spread) The Long Option Strategy chooses the optimal strike for the extended move expected in the chart. The trade is then managed with a trailing stop to capture the whole move. This combination allows the strategy to maximize gains and control risk. The Debit Spread Strategy employs a similar approach, but sells an additional call option to lower the overall cost of entry, and increase the probability of success. The Strategies purchase options when they are relatively cheap, and the stock is likely to make an extended move. This allows these strategies to produce huge percentage gains, like you see in the chart of AIG (above). Equity Curve showing the performance of the Swing Trading (Naked Puts) Strategy trading options on the symbols in the S&P100 over the past two years. The Strategy returns 51% over this time period with a maximum drawdown of only 7.3%. 6

7 urns for Swing and Extended Trades! Four NEW Option TradePlans The new Strategies in OptionTrader 3 use specific directional Trade Plans that are optimized for Directional Trading with Options. But they aren t just for these strategies. The Trade Plans can also be used to help manage any Directional Options Trade. This helps you realize the maximum profit potential on all your directional options positions: Swing Naked Write Swing Credit Spread Extended Moves Debit Spread Extended Moves Long Option The Trade Plans use OptionFinder s search algorithm to determine the best options for a given setup, then manage that trade with exits that are designed to capture gains for the given setup. The Swing Credit Spread Trade Plan boosts the profitablity of RTM7 Signals. +7% +11% +12% When used with your favorite signals, our new Options TradePlans take the guesswork out of Directional Trading with Options. In this example, the Swing Credit Spread Trade Plan nets just over 30% on Signals from RTM7. The NEW Visual Volatility Tool Designed to Keep You on the Right Side of the Trade! These Options are too expensive. Look to sell them. Time to Expiration These Options are relatively cheap. Look to purchase them. Strike Price Our new Visual Volatility Tool lets you see which options in the chain are relatively cheap and which ones are too expensive. You can use this information to ensure you are always buying the ones that are cheap and selling options that are overpriced. The Visualizer also has an animated playback feature that allows you to see how the volatility surface changes from day to day, and helps you avoid the costly surprises that can come from an abrupt change in volatility. This feature brings the rocket science of options analysis into a simple, easy to understand plot, and takes the guesswork out of monitoring options volatility. 7

8 A NEW Trading Course by Ed Downs Harnessing the Power of Maximize Your Profits with Directional Options Trading Most people are familiar with buying a Call Option on a stock when they think it is going up. But there are other option strategies that can be less risky and generate higher, more consistent returns over the course of many trades. In Part One, we thoroughly cover Directional Option Trading. I ll show you which Setups lend themselves to the most profitable trades. Then, I ll show you how to set Profit and Loss targets so OptionTrader can find the best Strategies. Options are the least understood financial vehicles available to traders and investors. Expiration Curves and the Greeks are not intuitive to most people. OptionTrader changes all that. I am now convinced, more than ever before if you want to make consistent profits, options are the way to go. Some of the topics we cover: How to set optimal targets from a few simple chart measurements. When Buying Calls is the best strategy and when it s not. How Credit Spreads can provide a unique advantage. A simple bullish strategy that can provide more overnight leverage - with the same risk - as buying the underlying stock. In the money vs. out of the money. And much more Once you SEE the Power of Options first-hand, and truly UNDERSTAND how to apply them using this incredible tool, your trading will be forever transformed. Reducing Risk is Important. But so is Making Money! We know that trading options can be less risky than trading stocks or futures, because with most Option Strategies, your risk is known going into a trade. But we also want to know HOW TO MAKE THE MOST MONEY. 60% Gain if the stock doesn t move up at all. Here is a Credit Spread on XOM. This could be a great trade. But even if the stock goes nowhere for 6 weeks I will make 60% on the margin that is required to place it. And my downside risk is limited. This is just one of the many money-making approaches we will cover. 8

9 Options with OptionTrader Making Options Trading SIMPLE AND PROFITABLE. Generate Consistent Income Using Options Perhaps the most popular use of options is to produce income. I have been to financial seminars that ONLY teach Selling Covered Calls. It s a great way to generate income when you own optionable equities. But Selling Covered Calls is just the tip of the Income-Producing iceberg! Once you start applying OptionTrader, more Strategies will emerge as optimal, including Condors, BuyWrites, and Strangles. The beautiful thing about OptionTrader is it can show you which Income Producing Strategy makes sense for a given chart. All you have to do is provide a few simple levels on the chart, which is what we cover in this course. In Part two we will cover these important income-producing approaches: Selling Covered Calls: What is the Optimal Time to Sell? The Option Ladder: Trade these stocks and pocket gains week after week after week. Buy-Writes: How to reduce your risk on every investment. Depending on the situation, you can often generate higher returns with little or no increase in overall risk by using an Option Strategy. In this course I will show you a variety of ways to accomplish this with simple, easy to understand methods. We devote Part One to covering speculative approaches to directional options trading. Then, in the second part, we help you round out your repertoire with powerful income-producing strategies. With these two approaches, this course will form a solid foundation that lets you immediately begin trading the options market with OptionTrader. My Number One Goal is to make options trading simple AND profitable for everyone who owns OptionTrader 3. This course will get you excited about trading options. I guarantee it! Then, you and I are going to engage the market together, in my first LIVE Options Coaching Sessions, as described on the next page. Solid income with low risk In this chart for CNP, we identified a Strangle that will generate solid profits if the stock ends up in a wide trading range, but very small losses if it moves outside this range. 9

10 4 Weeks of Options Trading with Ed Himself! It s Just You, Me, and the Market. My objective in Harnessing the Power of Options will be to show you how to quickly and easily spot the best option trading opportunities. It s actually very easy to do that with OptionTrader 3! But we all know that Powerpoint Slides and even historical simulations are not the same as the Hard Right Edge. So, I ve decided to host a solid month of actual options trading. Twice a week, for four weeks beginning May 12 I will hold live sessions in which I discuss the actual candidates I am trading and walk through each trading decision using the software. After the first session, we will begin each time with a review of our trading progress and talk about what went right as well as what we could have done better. These will be LIVE trades in my actual trading account. This is the first time since our Omni Trader University courses that I have ever held a continuous trading venue with users. I m limiting attendance because I want to be able to interact with each student personally. Let s make hay in the month of May! I look forward to seeing you in my sessions, starting May 12. Sincerely, Getting Started with Options Using OptionTrader 3 This CD seminar, included FREE with the software, covers the entire spectrum of product usage and option trading for those who are new to the art. Part I provides a quick overview of options. Because we use the options simulator, the concepts are quick and easy to grasp. Part II goes over every aspect of using the software, from setting up your data account to trading with the Visual Brokerage feature of OmniTrader and VisualTrader. We also cover OptionFinder and other advanced features. In Part III we go under the hood to discover how to add Option Trade Plans to our Strategies and how the Option Engine works. This feature allows OptionTrader to find the best Options Strategy. We also cover option strategy testing in the Portfolio Simulator. 10 Seminar Agenda I. An Options Primer Options as an Investment Why Some Traders Lose Money Trading Options, and How to Avoid it! Options Method Overview II. Using OptionTrader Setting Up the Software Activating in a Chart Setting Targets Trading Option Positions III. Options Trade Plans How Options Plans Work Adding Options Plans to a Strategy Testing the Strategy Portfolio Simulations

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