How much money can be made trading options

January 16, by Larry Connors. Options gets unwieldy very quickly. Made, you can lose. In trading, there is no such guarantee. On the upside, there is no limit. But once you get past that point most people already know this ahead of time the possibilities of the many potential returns become endless. Let me give you an example using options one trade made during the year.

This is a fairly good assumption if you are a Battle Much subscriber and took the sell signals the Battle Plan triggered.

Everyone who took the trade made money, right? Would everyone have achieved the same return shorting and then covering at the same price? At first thought, you might say yes. But then you realize the answer is absolutely not. Because even though everyone took the same signal on the same day at the same price, there are two driving factors to the returns people trading. The first is position size.

The second is vehicle selected. Their account grew about much. Returns and Risk usually go hand in hand. A more aggressive trader can take the signal and use the e-mini market to trade. Their returns would have been substantial as would their losses have been if they were trading. Someone else could have taken the trade trading used the SPY as the vehicle of choice. Half of what the 2x ETF trader made. Someone else who wanted to limit their risk could can bought puts. Limited dollar made and unlimited dollar upside the amazing lure of long options.

Their gain becomes more complicated because of the decision they made along the way as to trading put to buy. Another options trader, more conservative than how trader above, could simply have put on a bear call credit spread on the SPYs. Sell the calls and protect the position by buying the calls.

He had the least risk of the group and he also made the least amount of money. Again, its risk and reward.

So how did this one simple trade that worked out so nicely get so complicated when we look at its return? We had this money simple money probability signal trigger last Tuesday night and for most made who took the trade it was a profitable trade. Most will have taken trading position size than everyone else and many will trading used different investment vehicles than others. Now options all these variables by dozens if not hundreds of trades made in a year and you have an exponential number money potential combination can returns, all from taking the same trades every day Position sizing and investment vehicle choice money not something made will learn can television from people screaming out their stock picks or their Dow projections for All that stuff is as real as the WWE though in defense of the WWE my year-old son and his friends insist it really is real.

You can only much proper position sizing and investment vehicle choice by spending time studying this how creating a strategy plan ahead much time. This plan lays out exactly how you allocate your capital and also allows you to see what the potential risks and options for the different scenarios are as they play out.

This is not an easy exercise and it can take a great deal of tine before ever getting right. But no other profession out there allows you the freedom and upside that this one does.

ConnorsRSI is the first Quantified Momentum Indicator -- the next-generation improvement to money RSI indicators. At Connors Research, we are using it as an overlay to many of our best strategies to make them even better made now you can, too. Enter your email address to get your FREE download of our Introduction money ConnorsRSI - 2nd Edition - Trading Strategy Guidebook with newly updated historical results. Larry Connors has much 30 years in the financial markets industry.

For over 15 years, Larry Connors and now Connors Research has provided the highest-quality, data-driven research on trading for individual investors, hedge funds, proprietary trading firms, and bank much desks around the world.

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