Options Mistakes and Risks | Phil Town

[@PhilTownRule1Investing]

Have you found success with trading options? Let me know in the comments below. My Cheat Sheet for Smarter Investing will give you the tools and resources to take that next step towards financial freedom. Click here to download: bit.ly/2BlJQxI

[@christianandrews7764]

#TastyTrade has a lot of good videos about options. It’s a two sided market and I do best when selling premium than buying it

[@triceptive]

I attended Phil's Rule 1 webinar workshop June 26-28 it was amazing. Learned a lot about options trading.

[@PhilTownRule1Investing]

Happy to hear it! What was your favorite part of the workshop?

[@triceptive]

@@PhilTownRule1Investing Hi Phil - The workshop was so good, its hard to say what my favorite part was. If I had to pick something, I would say it was learning from all the different coaches and their personal experiences, and how Rule 1 investing changed their lives. I especially liked Kevin's story and his way of teaching. Overall a great experience, I am still a novice, but I feel I learned enough over those 3 days to get started in the right direction. Hopefully when all this is over, I can attend a live workshop, because I really want to learn more. I did sign up for the "Kick me in the butt Phil". So hoping to learn more there. Thank you.

[@fiyamage]

I was in the May class, it was awesome.

[@andreassmidelov]

@@fiyamage May crew reporting in! Money well spent :)

[@00null00null00]

Thanks for the explanation about the details of the process. I've heard many others only talking about losing 700k in options trading but not the full picture.

[@PhilTownRule1Investing]

Thank you for watching! Glad you found this helpful.

[@kingkang6877]

The chemistry between these two are awesome. Great work content and chemistry is good!

[@carolea7158]

Thank you for explaining this; I was wondering what had happened.

[@orenka1991]

I know it's speculating but I love options :D I am not risking my entire portfolio only around 1-2%. And I sell options because I have a higher probability to win on those and always hedge it. I usually exit when I can collect the 75% of the maximum profit :) Just got through your entire podcast I read your books except Invested, but I plan to read that also :) I learned finance and accounting in university but that was not as interesting as you describe things and now I know MPT is bs... I always had this feeling :D I started to listen to your podcast in 2019 december. I can't really express how thankful I am for you already! :) Thank you!

[@kriskenny5481]

A free lesson to say the least. Thank you Danielle and Phil.

[@onlinestor]

It happened to me also. It was on the index spread. On Saturday morning, when I checked my account it shows -$5Mish. At first I panicked but I said screw it and stopped paying attention. But when I checked again in a couple of hours, it debited +$5Mish and the difference was only about a couple of hundreds. :)

[@offroadster2000]

Great video! Thanks for the explanation, I was wondering what happened. So sad.

[@keyframex]

Sorry if this is off-topic, but I ran some numbers on $TSLA and got a fair price is $1,702.53/share @ 15% rate of return, with 2020-2025 EPS of $3.50, $11.50, $16.10, $22.54, $31.56, $48.92 (these are Wall St. estimates from a couple of months ago) and 70x P/E (typical of high growers in tech sector). If you're ok with 67% margin of safety (not 50%), it looks like it's still a buy at $1,140.70/sh. Am I doing something wrong?

[@martinfromseacity2010]

Thanks for all you do. Caught a nice salmon yesterday. Marty from southeast Alaska

[@richardhead2318]

Do you think selling puts for stock you would like to own at the strike price is a good long-term investment strategy?

[@moogs15]

Richard Head absolutely

[@onlinestor]

I always sell covered put 2-3 strikes lower than I like to pay for the stock. That way, I normally does not get the stock assigned and just collected the premium. Once it assigned, I pay cheaper. And at the time when the stock is assigned, the basis has been reduced substentially.

[@patp9819]

If i buy a put option whats my risk? Just the cost of contract or more

[@TheNateSamson]

Just the cost of your premium ... you can always double check using an options calculator free online that’s what I do to see what my profit or loss could be before buying

[@MapAtlass]

I would rather just buy into a poker tournament instead of trading options, then I would at least have some control.

[@BB-nn1tu]

I feel I have 100% control trading options and know exactly what my risks are.

[@MapAtlass]

@@BB-nn1tu If you do the research, there is actually less chance of succeeding in trading options than playing poker.

[@gustavocoelho11]

I never tried to trade options Mr. Phil! I feel more confortable with stocks

[@CaseyBurnsInvesting]

Tragic loss. Money isn’t worth your life. When it comes down to it, if you get a dopamine rush from your investments, they’re not investments, you’re at the casino.

[@GrowYourWealth101]

Haha yes that's true. :D

[@PhilTownRule1Investing]

Absolutely.

[@lindawangmsw5878]

Love your show, but Danielle, could you please move a bit farther from the mic? It's disporportionately louder that your dad's mic. Thanks!!!

[@menumlor9365]

6:14 I was gonna say he didn't understand the equity of the options trade.

[@ashleysuares8479]

Very informative video.

[@emmanuelphua]

shocking news. thanks for sharing this real life example - knowledge is power

[@adrianbarrett7710]

There are quite a number of overvalued stocks which I'm advìsed by my broker to stay away from. I'll just invest in divìdend stocks and Cryptos, I'm getting a lot of returns from my investments.

[@Cliffordtradeinc]

Hey what broker/platform do you trade with, and how do I get more info about how they operate. I would really like to work with a professional for a change.

[@hallandpascals8236]

Those are greats options to have now. Keep at it. If you've got no problem holding onto those for long term, you'll earn money.

[@adrianbarrett7710]

Harper Owen I trade with an investment Company, under the management of Kyle Holt Karens, you can get to her directly on tele_gram @ Kyleoltens

[@adrianbarrett7710]

Serah Wood yes you’re right I'm seeing the prospects in that,I'm about to close in on about 64% return of my $200k investments. I've been holding long term

[@huggiesmelina3366]

Not working anymore , receiving about 350k in dividends. Kyle Holt Karens strategy is the best !

[@BB-nn1tu]

You taught us this in class; how the trades settle. How sad he didn't know.

[@fundin3539]

Hey Phil! Great video once again. I have a question about AMD (Advanced Micro Devices) and its financial statements. I was looking at it because I'm currently doing research on one of its competitors, Intel. When I looked at AMD's balance sheet, I noticed an alarming thing. Its Retained Earnings, has been negative for many years now and it's not showing that significant growth (as in going towards positive side). What could explain this? AMD does not even pay dividends! Help me out uncle Phil! Edit: So I did a little bit more research and I noticed there has been continuous net income loss for AMD. and I'm pretty sure this has been the cause of enormous retained earnings loss that has accumulated during the years. Is this company doomed? it seems so for me because it's not growing at a rate that it would become profitable when it comes to retained earnings in the near future. I would love to hear more about this from you and maybe you could give me food for thought on this. Here is a graph of AMD's retained earnings from 2007-2019 imgur.com/a/sRPpsB7

[@TheOneAboveAllx]

I don't get it....even if he was negative 730k in debt couldn't he had just declared bankruptcy and started over?

[@Victorious416]

He's 20 dude. He probably didnt know any of that.

[@TheOneAboveAllx]

I m 17 and I know this since 14

[@carolea7158]

unfortunately, not everyone knows. If he was doing this during his free time he may have thought I just put my family in a hole; I'm stupid. Panic and fear just takes over.

[@TheOneAboveAllx]

I understand

[@Putseller100]

That’s the thing about spreads, especially selling spreads like the bull put. The leverage is soo much and one small more can cripple an account. If he had just sold the outs alone he would know the risk up front, but buying that protective put really lowers the margins and it’s easy to feel you can take much larger risks. This happened to me about a year ago and I am embarrassed to say it but I sold SPY bull put spread. It was only 4 contracts and prob 3 points wide so 1,200 risk minus commissions. Well it closed just below the short strike by about .10 cents and low and behold it showed I owed 132,000 because 400 SPY shares were shorted in my account. Luckily I understood I can buy to close mon morning, but where would SPY open at? These firms should have same day substitution which just closes out these spreads for the win or lose they have. This is bullshit they play these snail paced games scaring the shit out of people. Anyway the best advice is with short spreads is always close them out Friday before close. I had a few close calls trying to get a few more bucks hoping it would expire worthless

[@dolltron6965]

Tragic story but i question the notion that someone sees their trading account like that and goes 'thats the signal to shed my mortal coil' i mean it's more likely there was other stress areas and that was the final nail.

[@investeer]

Being from Europe, I think the solution is information. My broker made me do multiple tests to see if I had market knowledge and then made me sign a contract stating that i'm liable for my position in every trade. Some brokers in Europe only allow people with enough of experience (5 years) to do "forex trading"

[@Je.rone_]

I've made money on options, i lost money on options, i think one should stay away until thei truly understand them,

[@PhilTownRule1Investing]

I agree. Tread lightly if you don't fully understand them.

[@Joe99]

Couldn't they have waited to call him on Monday instead of on the weekend where he couldn't call them back? So sad

[@JDC8792]

I'm so choked to hear that he committed suicide over a mistake he thought he lost nearly a million when in fact it was a thousand bucks. This is the saddest story I've heard in a long time.

[@iw1377379]

It never occurred to me Danielle would not be proficient in options.

[@mikecole1664]

Don’t kill yourself over money. Unfortunately there were other issues with this person that he took such drastic measures.

[@bwfreel]

That kids story is 😢 sad, education is important

[@marcmini8137]

i love options baby. I feeel bad for this kid. Lack of education and guidence. worst case senerio he could of just claimed bankruptcy and moved on with his life. you cant go to jail for a financial mistake like this :)