Are your stock option trading results real?

One of the first questions we are always asked is:  Are the stock option trading results real?  I want to be the first to say that there aren’t many stock option pick websites that will actually show their track record for their trades.  Now I won’t say we are the only one, because I’m sure there are a few others. However, our belief is that you keep subscribers based on results and accountability. Yes, our stock option trading results are real.
 
Of course, not every trade will be a winner as you will see in our 2009 Track Record, but we had 238 trades for the year with only 66 losers – a 72% success rate.  Before we launched our private members area on September 1st, 2009, our public stock option trades can be researched and referenced from the Track Record. You can locate each post by using the search box on our home page.  These are good learning examples, and they are also time-stamped to show our integrity. 

There are many stock option picks sites that give you a “Closing Price” from the night before and say that is when you “could” have gotten in.  Then the next day when you try to enter the trade, you find that the spread or entry price is totally different because of a large move.  All the stocks and options I mention have the current market quote as I write the public blog and do trade updates for our members.  There are no smoke and mirrors.  If we are wrong, I will say I blew a trade.  It’s that simple.

When do you take profits?
 
We target profits at 100%, and raise our stops along the way. Occasionally, we have profiled stock option trades which have returned upwards of 2,500%. That is not a typo! However, for the most part our goal is to double our money on each trade. We usually take profits at 100%, and close at least half our position to protect our profits.
 
What is your stop loss for each stock option trade?
 
We normally limit our losses to 50%. We place both hard and mental stops depending on the specific trade. Once a trade hits our stop loss or is near our stop loss we usually move on. However, there are times where we may leave a trade open if we still believe it can turn around. We may occasionally adjust a stop 10 or 20 cents below 50%, but we’ll explain why on that particular trade. We have seen stock options lose 75% of their value only to soar by 1,000% the next day.

Why do some option trades on your track record show losses greater than 50%?

We do not typically place hard stops on stock options whose premiums are less than one dollar ($1). The reason for this is due to volatility. If we did place a hard stop, we would routinely be stopped out and not give the trade enough room to work in our favor.

Do I have to watch the stock market all day?

No, absolutely not. We are NOT an intraday trading service. All stock option picks come with clear stop loss and profit taking targets. You simply read the Trade Updates at 9 am each morning and at 1 pm each afternoon. Then place any new trades and make any current trade adjustments. That’s it. We want to keep it simple for everyone. Plus, staring at the market all day gets boring!

How often do you post to your stock options alerts blog?

We do daily market updates at 9 am and 1 pm EST. Occasionally, we’ll do a midmorning or late night post if there is news and any option trades need to be updated. New stock option trades and current trade updates are discussed in the Members area.

Do you offer e-mail for your stock options alerts?

Yes, all blog posts and option trade updates are also sent to you via e-mail in real time – typically at 9 am and 1pm EST.

Do you offer cell phone alerts?

Yes, when a new blog post or member update is made, you have the option to be notified via cell phone at no extra charge.

Do you offer auto-trading?

Yes, we do. Click here for more details.

How many stock option trades do you make on average each month?
 
We average anywhere from 1-3 option trades per week – sometimes more or less depending on market conditions. What we won’t do is make a trade simply for the sake of trading. We look for the BEST trades and the BEST conditions to make you money.

What do your stock option trade updates look like inside the Members Area?

Before we launched our Members area, all stock option picks were public. Click on these previous posts to get a feel for our style. We set entry and exit targets before you get into the trade, and update you daily on all stock option trade positions.

• Stock Option Trade Update – December 1, 2009
• Stock Option Trade Update – November 3, 2009
• Stock ption Trade Updates – August 23, 2009
• Stock Option Trade Update – August 20, 2009
• Stock Option Trade Updates Explained - August 5, 2009
• Stock Option Trade Update – July 30, 2009

Stock Option Trade Pick Screenshot

Why do you only do call and put option trades?
 
If you are new to the world of stock options, they can be very complex. Once you learn how basic call and put options work, you can use them for more advanced trades like credit spreads, iron condors, and calendar spreads. All of these “advanced trading strategies” can be used with both call and put options, but they do not provide the same returns as directional, momentum stock trading does. It’s possible for a call or put option to gain 200%, 500% and even 3,000%, but advanced stock option strategies limit your income potential. For instance, covered calls – which are used to protect you from a downside move if you own the stock – can bring you monthly income of 3%-6%. Buying an outright put option on a declining stock can bring you a triple-digit return in a matter of hours or days.
 
How do you decide which stock options to trade?
 
There are many variables that go into selecting a stock option trade. We discuss this in more detail in our stock options trading manual. We can’t give away all of our secrets, but the bottom line is that you have to be able to identify which stocks are moving or which ones are ABOUT to move. Then we do our homework to define our profit (and loss) zones and decide if the trade is worth taking. For each option trade we recommend, we offer a detailed explanation as to why we feel a stock is ready to “pop” or “drop.”
 
Do you buy out-of-the-money stock options?
 
Yes. Most of our options trades are at-the-money or out-of-the-money with an average price of $1.00 -$2.00 ($100 to $200 per option contract). There are times where we find cheaper stock options that only cost 50 cents ($50) for one contract. Occasionally, we may profile an option trade with a price tag of $3 or more. These trades are rare, and most of the time they involve stocks which are trading over $100 – $200 or more per share.
 
How much on average does each stock option cost?
 
Most of our individual stock option trades have an average price of average price of $1.00 -$2.00 ($100 to $200 per option contract) with an occasional option trade with costs $3 or more.

How much does each stock option trade normally cost?

We like to purchase 10-20 contracts for each stock option we recommend for a total cost between $1,000 – $2,000. However, as with all trading, carefully evaluate your risk tolerance level and how much you are willing to lose! Never risk all of your capital on a single trade! Only risk a small percentage of your trading account on any one trade – perhaps in the 2 – 5% range! If you buy 5 contracts, then your average cost per trade is $300 – $500. If you are just starting out, consider buying just 1 or 2 option contracts.
 
How much money do I need to get started trading stock options? What % of your trading account is exposed to risk at any given time?
 
Never trade with money you can’t afford to lose! We recommend every portfolio should have a portion specifically for trading stock options. How much depends on you and your risk tolerance level. For our specific momentum stock options trading style, the absolute minimum account size we suggest is at least $2,000. However, with an account this small, a single 5-contract trade with a $1 option would cost you $500. That’s 25% of your entire account. With an account this size, you might consider buying only 1 or 2 contracts per recommendation. Ideally, an account size of $5,000 – $10,000 will give you more flexibility as to how many option contracts you can trade. With a $10,000 account you would only be risking 5% of your entire account with a $500 option trade.
 
Do you provide ongoing support?
 
Yes, our staff normally responds to all emails within 24 hours or less. Our stock options trading course manual (coming soon) is an “easy read,” and is written in a way to help you easily understand how call and put options work. We teach you step-by-step everything you need to know about how to spot a high probability option trade and define your profit and loss targets.

What exactly will I find in your Members Area?

As a subscriber to our stock option pick service, you simply login and read the daily market updates at 9 am and 1 pm Eastern Standard Time (EST). All stock option trade updates are posted BEFORE the market opens in the Members Area each morning.  If we decide to do a “mid-day” trade we will alert you on the 1pm update.  We rarely do these types of trades because it would be hard for some subscribers to keep up.  However, if we do, the 1pm update will tell subscribers to go to the Members Area.  Again, mid-day trades are rare.  Otherwise, any “new” trades are posted in the morning blog at 9am EST.
 
Other than that, we give clear entry and exit points on what to look for as far as the option trade goes.  Sometimes we will say this is a quick or day trade only.  Other times we will go further out on the option trade to let a trade take shape.

The members area also includes a 30-page Welcome Guide that explains our approach in more detail. We’ll soon be rolling out a full-blown momentum options trading manual and educational videos.

Do you offer a guarantee or refunds?

No, we do not offer a guarantee or refunds as there are too many market factors beyond our control.

I have more questions. What is the best way to reach you?

Don’t hesitate to send us an email at support@momentumoptionstrading.com, or call us at (888) 898-0837.