- Written by OptionDave
As we officially enter into Quarter 3 Earnings Season this week, and are currently sitting at an all-time high in the Markets, we must prepare ourselves for what is likely to be a very interesting, volatile and profitable month of trading. If you are not familiar with the ETNtrade style of trading, you may be surprised to see that we primarily use weekly expiration options, out-of-the-money spreads and in many cases, cover both possible directions the stock may move. While many Traders struggle to find a consistent statistical advantage when trading during Earnings, ETNtraders are very comfortable with our approach, our simple analysis and calculations, and the trades we will profit with from week to week.
So, what is the secret sauce that allows ETNtrade Members the opportunity to make 100-300% ROR in 2 to 4 days? It all boils down to a few simple calculations that allow us to make important decisions on what we think the stock will do, and therefore what strikes to use, based on what the experts reveal to us. It is actually a very simple process, but it takes practice and patience to master. Let me give you an example of this type of trading style:
On Wednesday of last week, we identified that the market expected WFC to move approximately $1.17, or 2.1% by Friday at close. Now, it did not say that it was to go up or down by that much; it simple stated that they expected it to move either up OR down by 2.1%. So, with WFC at 55.50, we positioned ourselves in a trade that allowed us to not lose our max risk as long as the stock moved only $.50 either way, break even if the stock moved $1.00 either way and max 100% ROR on our investment if it moved $1.50 either way. Think about that for a second… As long as the stock does what the Professionals think it will, we make money! That is a perfect scenario.
So, what happened? WFC ended the week at 53.69. The trade returned us 100% on our investment (we put 4 units on the trade, or 4% of our portfolio). So, we made an overall 4% return on our portfolio in TWO DAYS. Annualize that one.
In my humbled opinion, if you are not trading this way, you are gambling. We have been proving these techniques to be profitable year after year since 2009. We will be hosting a 2 Week Training Series in the coming weeks, so if you are interested in joining us for that, make sure to sign up for the upcoming free introduction to ETNtrade webinar on the right of this page. If you have any questions, of would like to discuss opportunities in becoming a Member, please feel free to ask. You can email me at Dave@ETNtrade.com.
I look forward to trading with you all in the near future. Let’s finish 2017 with a bang!!!