IN THIS ISSUE
Brian Schad
The Options
Lee Gettess' Market Sense
How to Profit if a Stock Goes Up or Down
Paper Trading Benefits and Pitfalls
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BRIAN SCHAD
 
One_on_One 
 

Brian began commodity trading for discretionary accounts as an exempt CTA (Commodity Trading Advisor) in February 1994.  Later that year, he was the co-founder of Trident Pacific Trading, Ltd., specializing in commodity trading for private accounts.  To further Brian's professional development, he entered the commodity brokers and options strategist field and was directly responsible for supervising over 70 accounts at Opportunities in Options.  From June 2002 to July 2005 he co-published possibly the oldest commodity trading publication in existence - the Commodity Timing Report - with legendary author, lecturer, and futures trader Larry Williams.  He is now an independent futures & options specialist servicing established commodity brokerage firms, working with private traders, commodity brokers, commodity producers, and financial consultants abroad.  Brian has been educated, and is endorsed, by many accredited names in the industry and is a man of faith, family, and leadership.

OUR AUTHOR TEAM
 
Adam Oliensis 
Andy Chambers
Brian Schad 
Chuck Hughes
Darrell Jobman
Dave Caplan
Don Fishback
Ellie Taft
Gary Wagner
George Angell
George Fontanills
Glenn Neely
Jack Schwager
Jeff Horovitz
Joe Duffy
Jon Najarian
John Weston
Kathy Lien
Ken W. Chow
Larry Connors
Larry Williams
Lawrence McMillan
Lee Gettess
Mark Fisher
Murray Ruggiero
Paul Forchione
Peter McKenna
Ray Frazier
Russell Sands
Scott Krieger
Ted Tesser
Tom DeMark
Tony Catalfamo
Welles Wilder
June 2, 2010     
    

Inside Trading offers you interesting insight from Brian Schad this week.  In his article, Brian explains options and how they are best used.

Lee Gettess provides the next segment with a video covering his market expectations for the next week.

Then, we go back to the discussion of options as Chuck introduces an option spread strategy that will allow you to profit regardless of whether your underlying stock goes up or down.

Don Wellenreiter wraps up this edition with the benefits and pitfalls of paper trading.

Enjoy!

Adrienne LaVigne
The Options
 

By: Brian Schad 

 

The following is an excerpt from Brian Schad's The 3-Dimensional Trading Breakthrough
 

Options were primarily developed as financial tools used to manage business risk, because they allow business operators to pay an up-front defined premium (or fee) for the chance to protect themselves from adverse price movements due to unforeseen circumstances (volatility).  Many people mistakenly assume that options strictly exist as speculative instruments and have only been created recently.  However, the use of options as risk-hedging tools has actually been in practice for many centuries.  In the past few decades, options have become popularized.  Options continue to be used as a risk-management strategy by professional traders and large commercial firms.  I am going to demonstrate how individual traders can successfully incorporate the use of options into a "low-risk" management trading style used in conjunction with futures contracts.

 

Lee Gettess' Market Sense
 
Lee Gettess is a top trader who is excited to bring you his new video newsletter. Each week, Lee will share his predictions on what he anticipates from the bond and S&P markets.
 

How to Profit if a Stock Goes Up or Down

 

By: Chuck Hughes 

 

The following is an excerpt of Chuck Hughes' Market Volatility Profit Secrets

The option spread strategy presented in this article has one of the best overall risk/reward profiles of any of the strategies I trade.  When you buy an out-of-the-money call option the premium consists of only time value and the price of the underlying stock has to rise considerably (depending on the strike price of the call) in order to break even on the trade.  This is a result of the time decay characteristics of options as they approach expiration.  Options lose all time value at option expiration.  For example, today is August 20th and Apple stock is currently trading at 123.22.  The Apple September 140-Strike call option s trading at 2.35 points and expires in about 5 weeks.

 
Paper Trading Benefits and Pitfalls
 
By: Don Wellenreiter

The following is an excerpt from Don Wellenreiter's Millionaire Secrets for the Average Guy 

For many newcomers, their first type of trading is paper trading.  This is where you trade the market as if it were real, except that orders are not actually entered, so you won't experience actual losses or gains.  This really is a good way for someone to learn some of the basics of trading without facing a large loss due to inexperience.  Using a charting service or getting the information from the internet, the new trader can track a commodity and plan his strategy for trading.  There are even websites that offer trading contests with artificial accounts, but still have real prize money that you can win.  This is where you can test a trend following system, a break out system, or a counter-trend program on as many commodities as you wish, since you are not limited by your margin requirement.  While you could paper trade numerous commodities at one time, I do not believe that there are many traders out there that can effectively trade more than a handful of markets at once.  Find a market(s) you understand and stick with it.

 

Paper trading versus reality

The 3-Dimensional Trading Breakthrough
A Definitive Method For Enhancing Profits & Minimizing Loss

 

What trader hasn't experienced this:  Put your stop too tight and you get The 3-Dimensional Trading Breakthroughstopped out of what later becomes a profitable trade. . .Put your stop to wide and your account gets clobbered by crippling losses. . .Try to hit middle ground and somehow you get stung once again!

 

No wonder Brian Schad, former Navy SEAL and 15-year trading professional, refers to stop-loss orders as the Trader's Death-Trap.

 

Learn more about 3-Dimensional Trading Breakthrough

PLEASE READ.  Past results are not necessarily indicative of future results.  There is a substantial risk of loss trading commodities with or without this or any other advertised product, service or system.  Also hypothetical or simulated performance results have certain inherent limitations.  Unlike an actual performance record, simulated results do not represent actual trading.  Since the trades have not actually been executed, the results may have under-or-over compensated for the impact, if any, of certain market factors, such as lack of liquidity.  Simulated trading programs in general are also subject to the fact that they are designed with the benefit of hindsight.  No representation is being made that any account will or is likely to achieve profits or losses similar to those shown.