WYMTM
The article of the week is here. - The video is at the bottom.
I’m headed to a charity golf tournament for Scottsdale Rugby association today and I left my clubs in Puerto Rico so this marks two evens this Summer playing without them. Not that it matters...but still…you need the right tools for the job.
(That was one we did and sponsored in 2020 when I was running Jack Grace Golf)
Speaking of the right tools I came across this on X last night.
I replied to it but I’ll share my thoughts here.
Account size does matter.
It matters massively and the ladies that tell you that are lying, for the record, they’re just being nice.
In fact, I wrote about this idea of using the right product/approach all based around the starting capital in this post a week ago titled: Dogs Chasing Cars.
What I replied with were a few points:
This idea that “Setups” are the only way to trade are a farce: a first order way of thinking by retail traders who learned from other retail traders who never thought to question what they were being taught.
You can get leverage on a $10K account by using a Deep In The Money Call/Put to trade any stock or ETF and build the portfolio faster v. buying the equity.
If I was trading $10K again I’d only trade: Index Options, WTI Crude Options and Deep In the Money Calls/Puts. - Forget the stock research or pretending to scan for charts as a way to feel busy.
If your goal is to take $10K and flip that then that’s the way. It’s not pretending you’re a stock analyst or Warren Buffet reading reports and structuring a portfolio.
But then again, I think most people that try to invest on their trying to be traders are just cosplaying a dream.
Whether that’s a tough pill to swallow or now is how you take it but that’s my view.
The other thing I mentioned regarding setups was this:
RDFN 0.00%↑ or NEM 0.00%↑ were not “stock setups” or back-tested 80% win rate ideas - it was what I said above: understanding the sectors inflecting and then finding the best vehicle to express that idea THEN the best option structure or structures.
That’s Agile Gnome - who heads the Active Trader but also manages his other accounts using DITM options and swings as needed.
Again, the idea of using equity long or short on a small account is first order thinking.
You can (AND SHOULD) use stock replacement as a way to express a view.
Concluding
Everyone has a view on markets and I’m just sharing mine but there are more efficient ways to get to the end goal of making money.
Some, they want to press buttons and feel as if they’re doing something, others, they just want to make the money.
If you’re here to make money then let us do what we do because we actually do it for real, not part-time or cosplaying as a side hobby.
You can get access to the Report & AST Alerts Portfolio for 50% off until end of the quarter with code: q3end
Enjoy the weekend.
Dan
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This article is presented for informational purposes only, is an opinion, and is not intended to recommend any investment, and is not an offer to sell or the solicitation of an offer to purchase an interest in any current or future investments. Any such solicitation of an offer to purchase interest will be made by a definitive private placement memorandum or other offering documents.