Overview of the Business of options and vertical spreads. Course

Video 1: Introduction to the Course

Run time: 11 mins 21 secs

The introduction to the course is module #1.

• We cover the big picture mindset that you should have when trading options
• How education plays a large role in your success with options
• The process that many people go through to learn the business of option trading and how you should do it differently

Video 2: Tools & Platform You Need

Run time: 13 mins 04 secs

There are three things you need to start with trading options. Topics will be covered.

• Recommended internet speeds and connection for trading options
• How much trading capital is recommended to start trading options
• The necessary requirements of your trading platform to trade options effectively

Video 3: Words of Wisdom & Why People Fail with Options

Run time: 18 mins 07 secs

I share with you some words of wisdom and things to watch out for as you get into trading options. We cover a lot of topics.

• The leverage mindset that people have when they first start trading options
• Educational problems that many people have with option trading
• How to properly think about setting up a trade with a plan and treat option trading like a business

Video 4: What Type of Trades You Can Do with Options

Run time: 7 mins 40 secs

There are a variety of options trades that you can setup. You can create any type of trade that you want. In this video, we cover some topics.

• Why options were created and the variations of trades you can create with options
• How options can give you virtually an unlimited number of trade setups
• How options can make you money even if the stock does not move from theta decay

Video 5: Three Parts to an Option Portfolio

Run time: 10 mins 33 secs

In this video we talk about the different ways you can structure your personal portfolio and how to create an options portfolio. You will learn in this video.

• The three components to your portfolio when trading options
• The type of portfolio that is best to have when you are getting started with options
• How to think about your portfolio allocation as you put on trades
• Why you need to look at your own risk tolerance before creating a portfolio

Video 6: Intro to Trading Options Like a Business

Run time: 55 mins 08 secs

You shift your view from trading as a hobby to making trading work for you when you start looking at options like a business. You will learn in this video.

• The two main components that grow any business including the option business
• To start seeing where you can make more money from a business perspective
• Why consistency is a critical key to long-term profitability
• Why your goal is not to find the golden goose, but to learn how to improve what it is you are doing
• How being self-aware helps you improve faster
• Key questions to ask yourself if you are not trading consistently or profitability.

Video 7: Trading Options Like a Business

Run time: 32 mins 11 secs

We get away from looking at a general business perspective and start looking at the core of how an options business works in this video. The topics that we cover are in this module.

• Business concepts to selling option premium
• How segments within the insurance business like auto, health, and home insurance operate and why option trading is similar
• The process of selling option premium at the upper and lower ranges of your stock price

Video 8: Why Adjustments are Key to Success

Run time: 54 mins 01 secs

It is important to know how to adjust a position when a trade goes against you. We will cover this in the video lesson.

• Why adjustments are important when it comes to option trading
• Why doing too many adjustments could create a problem for your portfolio
• The right amount of adjustments to your portfolio at any given time

Video 9: The Big Picture of Trading Options

Run time: 35 mins 11 secs

There is a big picture behind trading options and vertical spreads. We cover topics in this module.

• Risk to reward ratios for selling insurance premiums and how this relates to trading options
• Various position setups when it comes to risky, normal, and safe trades
• How the management and taking profits of your options allows you to reduce your risk and brings you higher profitability

Video 10: Growing as a Trader

Run time: 28 mins 02 secs

Growth and development as an options trader is the topic of module 10. It’s about looking at yourself and how to grow personally in this business. We cover topics in this module.

• The growth process of improving within options through time
• How many contracts you might want to start with and the time frame to increasing the contract size
• The different stages you might go through personally as you learn options
• How many adjustments and the type of trading you should do when you are just getting started

Video 11: Profit Potential & Growing Your Account

Run time: 32 mins 54 secs

When it comes to various option trades, we look at the profit potential that you can make and how to grow your account. You will learn in this module.

• The growth process behind fine tuning a strategy and improving it
• Why having a higher frequency of trades can improve your financial growth
• The impacts that the percentage of your wins will have on your account
• Why reducing your drawdowns is important to growing your account

Video 12: Long Term Profit Potential

Run time: 42 mins 11 secs

In this video, we look at the long term growth potential for your account in Microsoft excel. The following topics are covered in this module.

• A realistic view to calculating your financial growth across multiple years based on your percentage of return
• How compounding each month helps accelerate your financial growth
• How to estimate the time it takes for you to achieve your trading goals
• How the growth curve is different when you have a large or a small account compared to your daily life

Video 13: Option Prices & the Vix Effect

Run time: 69 mins 09 secs

The module focuses on how options are priced and how volatility affects those prices. You will learn in this video.

• The 3 primary things that determine an options price
• How the VIX plays a key role to pricing options
• When should you be a seller of options vs a buyer of options based on the VIX
• How to evaluate volatilities on a variety of stocks and understand their pricing

Video 14: Basic Options: Calls & Puts

Run time: 47 mins 11 secs

In module 14 we look at the profit pictures behind calls and put options and how they work so that we can build on these concepts in the future. Topics will be covered.

• Reviewing the profit picture for a stock
• The profit picture for a call option and how a call option works
• The profit picture for a put option and how it works
• Why people buy single call or put options and why you should avoid single options

Video 15: Dangers of Buying Single Contracts

Run time: 36 mins 56 secs

In module #15, we look at the dangers of single option contracts. In this module, we will cover topics.

• The risk profile picture for a single call and put option.
• We look at multiple examples and evaluate the delta, gamma, theta, and vega within buying single option contracts.

Video 16: Selling Puts & Calls for Premium

Run time: 29 mins 56 secs

Selling puts and calls for premium are the focus of module #16. This is where we put things together from the earlier lessons and begin trading options. The following topics are covered in the video.

• What the profit picture looks like to selling a call and selling a put
• The basic option greeks behind selling option premium
• How to have time decay work in your favor when you are trading options

Video 17: Win/Lose Scenarios for Single Options

Run time: 32 mins 43 secs

The win and lose scenarios for single options are looked at in this module. There are lessons we cover.

• Tip to remember the profit picture for buying a call or put vs selling a call or put
• The win and loss outcomes for buying and sellings puts and calls.
• Looking on screen and comparing buying a put or call and selling a put or call

Video 18: Intro to Vertical Spreads

Run time: 28 mins 05 secs

The basics of vertical spreads and the profit picture are covered in this module. We discuss in this video.

• The profit picture of a vertical spread vs a simple call option
• Win / Lose outcomes for vertical spreads
• The craving for unlimited profit potential when it comes to single call contracts
• Healthy and realistic movements within a stock
• How the core of our option business stems from the strangle

Video 19: How Verticals are Constructed

Run time: 53 mins 53 secs

In video 19 you will learn how they are constructed. In this module, we combine a multi-leg strategy so that we can see how a trade is created from buying and selling options. The topics we cover are:

• How a vertical spread is constructed
• How to widen the vertical spread by manipulating the strike prices
• Where to position or start your vertical position
• How many days out should you get into vertical spreads
• How to setup a balanced vertical spread where your risk to reward is 50% / 50%

Video 20: Selling Vertical Spreads

Run time: 51 mins 48 secs

In module 20 we look at why you want to be a net seller of option premium and how to sell vertical options. We cover in this video.

• The review of the strangle and how it is the core to selling option premium including verticals
• How to create a selling vertical strategy within a trading platform
• How you can combine selling multiple vertical strategies from the call and put side to make more money and create even more advanced strategies such as the iron condor

Video 21: Big Picture of Trading Verticals

Run time: 36 mins 49 secs

In module #21, we look at the big picture of trading and the flexibility behind it. The following topics are covered in the video.

• Variations of different trade setups and compare them to the vertical spread
• The capital requirements and differences for the different types of trade setups
• Comparing the risk to reward scenarios based on the capital you use on a per trade basis
• How to vertical can be adjusted to compensate for the risk you want to take on

Video 22: Finding Vertical Trades & Spreads

Run time: 73 mins 11 secs

We focus on finding vertical trades and setup opportunities in this module. You will learn in this video.

• The critical things to check prior to placing an order for your vertical spread
• How to spot liquidity issues and problems within certain options
• How implied volatility plays a role within selecting your option contracts
• My favorite stocks and indexes to trade options on

Video 23: How to Study & Take Notes as We Do Trade Reviews

Run time: 8 mins 47 secs

Sharing with you another variation to taking notes on our positions as we get into entering trades, managing our positions, and taking profits is part of module 23. We recorded our positions in chronological order, but you could take your notes based on an individual trade basis.

Video 24: Intro to Entering Vertical Spreads

Run time: 48 mins 47 secs

You can see how to properly manage a vertical spread in our simulation example trades in module 24. We cover this in the module.

• How to properly select a trading vehicle and choose the appropriate strike prices
• The best time to enter an options trade including the best weekday and time during the trading day
• How to negotiate and get a better fill rate on your option spreads
• The maximum amount of positions that you want to trade when you are first getting started

Video 25: Entering More Vertical Spreads

Run time: 60 mins 31 secs

We put on more vertical trade opportunities in this video. Our main focus is to:

• Add more positions to our trade examples and simulated trades
• Choose our stop loss as we create vertical spreads so that we know when to get out
• Evaluate where our ideal zone is to take profits

Video 26: Statistical Probabilities

Run time: 32 mins 57 secs

We look at the chances behind our trades in module 26. We will cover this in the video.

• Standard deviation basics when it comes to statistics and how it plays a role in stock trading
• How to evaluate your chance of success before you put on an option spread
• How to evaluate the potential move of a stock or equity based on the standard deviation
• How to properly select the strike prices for your options based on the statistical probability of your trade working out in your favor

Video 27: Big Picture to Adjustments

Run time: 34 mins 04 secs

Although we focused on some basic concepts to adjustments earlier, in this module we focus on a bigger picture view to adjustments along with some adjustment problems that you might run into like inversion. We cover this in the module.

• The most dangerous thing that can happen to you when adjusting options!
• Looking at adjustments for risk reduction – not just a change in position
• The number of adjustments that is recommended as you are getting started or if you are more experienced with options
• The external costs to adjustments beyond the financial costs

Video 28: The Greeks: Verticals

Run time: 46 mins 23 secs

Video #28 focuses on evaluating the greek risks on our vertical spreads and positions. The following topics are covered in the video.

• The core reason you want to watch your greeks when you have active positions in the stock market.
• How the delta and gamma work together to show you the price risk that you have on your positions.
• How theta shows you the time risk you have our position and how it works within verticals.
• Understanding your vega (or volatility) risk and how to get neutrality on your position.

Video 29: Managing Verticals as a Portfolio

Run time: 46 mins 20 secs

In module #29 we focus on evaluating and managing our vertical positions. This will allow you to see all of your positions at once. You will learn in this module.

• How to evaluate your trades as a portfolio beta weighted position
• The adjustments you can make to your portfolio if the market has a sudden change against you
• Variations on how to hedge and create a neutral position with your portfolio

Video 30: Daily Review on Our Verticals

Run time: 46 mins 11 secs

We review the positions that we entered in the course in this video. We cover in this video.

• Which positions you might want to take profits on to reduce your risk
• How many contracts or how much of your profit to take off when you are reducing your positions
• Why you might want to adjust certain positions and not others
• Which positions you want to be extra careful about and what to watch out for with risk-averse positions

Video 31: Review of Our Trades & Taking Profits

Run time: 60 mins 55 secs

We continue to review our positions over the course of several days. The things that we discuss are in this module.

• The strategical mindset to managing your portfolio
• More profit taking concepts within your positions
• Additional insight to hedging our portfolio against a negative market move

Video 32: Trading Verticals on Cheap Stocks

Run time: 12 mins 23 secs

The focus of module #32 is how to setup vertical spread strategies on cheaper or less expensive vehicles. We cover in this video.

• How theta decay is different on cheaper stocks than expensive stocks
• How to properly setup your strike prices when there is little selection from the option chain
• The advantages and disadvantages to trading options on cheaper stocks

Video 33: Trading Verticals on Expensive Stocks

Run time: 58 mins 17 secs

I will show you how to trade option spreads on expensive stocks and what to look out for. We cover a lot of topics.

• How to trade expensive stocks even when you don’t have a lot of capital
• What the advantages and disadvantages are to trading expensive equities
• How open interest, fills, and bid-ask spreads effect your entries with expensive stocks
• The problems you may have with volatility and price movements on expensive stocks and how to counteract the problem

Video 34: Final Review and Summary

Run time: 60 mins 05 secs

The final review of the concepts, theories, and trade setup we covered in the course is done in this module. To put the big picture concepts together, I try to hit a few key points from various modules. It’s a great module to review a few times after you’ve finished the course because it will help you remember the things we covered.

Video 35: Final Words & Thank You

Run time: 15 mins 02 secs

The final module is Module 35. We finish this course with some final words of wisdom and a few resources that you can use to move forward with your trading education and journey.

Bonus #1: (Video) Options Trading Panel Overview for ThinkorSwim

Run time: 75 mins 00 secs

This bonus video is a recording of a class we had for option traders. The topics that we cover are in this section.

• Module #1: Introduction to options and my story with learning options
• Module #2: Why a great panel and software is important – but you don’t need the best
• Module #3: Big picture overview of the ThinkorSwim platform
• Module #4: Option Trade Selection
• Module #5: Advanced option trade grid (spreads, changing columns, option statistics, time & sales)
• Module #6: Questions and Answers

Bonus #2: (Video) Risk Profile Pictures for Options & Hedging

Run time: 90 mins 21 secs

This bonus video is a recording of a class we had for option traders. The topics that we cover are in this section.

• Module #1: How risk profiles and profit pictures work on Paper
• Module #2 How risk profiles work within the panel & manipulating them
• Module #3: Playing with different strategies and evaluating risk profiles
• Module #4: Micro-details (greeks, price slices, shifting date, price, volatility, overlapping trades)
• Module #5: How to hedge your positions on a portfolio basis using an index like the SPY
• Module #6: Questions and Answers