How to Avoid Catastrophic Option Trading Losses

See TradeKing's "Top 10 Option Trading Mistakes Beginning Option Traders Make" referenced in video: https://www.tradeking.com/education/options/top-10-option-trading-mistakes ----- There are essentially three categories of potential catastrophic losses in the stock market - big macro events, bad investments, and self-inflicted trades. This video focuses on the last category - the self-inflicted risks that come from entering into what I call structurally disadvantaged trades. What are structurally disadvantaged trades? Any trade where I need a stock to behave in a certain way within a certain time frame or I lose money - that's a structurally disadvantaged trade - and it can lead to the catastrophic loss. In contrast, structurally advantaged trades, such as the customized put writing strategy I teach inside The Leveraged Investing Club (to learn more, check out this link: http://www.great-option-trading-strategies.com/leveraged-investing-guide.html ) is what I call "structurally advantaged." - It consistently generates high yield income and enables me to make low cost basis acquisitions of high quality businesses - It enables me to be compensated for being exposed to volatility, not risk (big difference) - I can set up the trade so that even the "worst case scenario" results in an attractive outcome - It's flexible enough that I can almost always restructure the trade if necessary in order to further improve the results ------- By way of example, the video contrasts cash-secured puts with bull put spreads and demonstrates the inherent risks of bull puts. Bottom line - the risk of catastrophic losses based on how one trades is something that can and should be avoided. ---------- Are you a high yield income investor, value investor, or dividend growth investor and would like to learn how options can make you much better at what you do? Download my free report here: http://www.great-option-trading-strategies.com/free-reports.html Thanks, Brad

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