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com

Even if You are Not a Trader or Investor

Trading Secrets They

Dont Want You to Know

Optionpundit.com

Copyright 2014 by ProfitPitTM Press.

All Rights Reserved.
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Dedicated to:

Your Success

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Why Should You

Learn to Trade
Options

Options are probably the greatest wealth

building tool ever invented, especially for retail
investors. However, Options trading is
infamous for all the wrong reasons. The
Internet as well as newspapers is filled with
attractive, influencing marketing sales-letters
that promise to make you rich very quickly.
Lets be fair, if those sales-letters were
promoting
to
OPERATE-IT-LIKE-AOptionpundit.com

BUSINESS, how many would really be attracted?

Lets face it, making huge money in shortest
possible time hits well to our internal desires.
With this key book, let me introduce you
to key reasons why you should learn to trade
options EVEN IF YOU ARE NOT A
TRADER.

Protection, Hedge,
Safety, Insurance

What if you could guard your

business against price fluctuations?
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What if you could have protected your

wealth during severe market losses
2000, 2008? What if you could hedge
your retirement savings invested into
your company stocks?
The primary reason you should consider
learning to trade options is the same as
insurance coverage. Learning how to hedge is
not only required for traders, but it is an skill
thats equally good for BUSINESS OWNERS
and COMPANY EMPLOYEE as well.
If you are a BUSINESS OWNER in a
sector where options are easily available, you
could hedge your business against price
fluctuations of factors that affect your
business activities.
These days options are available on almost
all asset classes such as Crude Oil, Gold,
Metals, Stocks, Grains (e.g. Soybean, Wheat,
Optionpundit.com
7

etc.), Currencies (e.g. Yen, British Pound,

Aussie Dollar, Euro, etc.). Knowing key
factors that can affect your business and then
hedging against those can be a really valuable
skill. Airlines do this most of the time, Coffee
producers/Starbucks continue to hedge and
similarly Copper and Gold Mine owners hedge
their output prices.
Even if you dont have listed options, you
could envision some and then find some sort
of over the counter legal ways to hedge it.
Options market is growing day by day and
now covers a wide range of products.
John (not his real name but a real story)
was a long term employee of a fortune 50
company. He was about to retire in 2008. I
saw tears in this big mans eyes when he saw
massive drop in his long term portfolio and he
needed to cash-in those holdings soon after
his retirement. He was counting his post
Optionpundit.com

retirement wealth mostly on his company

stocks.
"I try to buy stock in businesses that are so wonderful
that an idiot can run them. Because sooner or later, one
will."
Warren Buffett
As a company EMPLOYEE, our
fortunes are usually tied to the company we
work for (in form of companys stock
ownership). Due to conflict of interest, one
might not be able to trade stocks/options on
that company but you could benchmark your

company stocks against relevant sector or

overall market that can help you in
protecting your long term wealth.
AS INDIVIDUAL INVESTOR, part of
your wealth might be in the form of long term
stocks holdings. Knowing how to protect your
Optionpundit.com

stock portfolio will save it for from

disappearing during severe market meltdown.
No one can pick market TOPS and
BOTTOMs else there wont be any market.
During past 14 years, we have seen huge rallies
and severe market losses many times. What if

you could have protected your wealth

when markets sold off deeply?
Let us know if you need help or have
questions
Ask@OptionPundit.com

Optionpundit.com

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Build Your

At Your Prices

What

if you could buy Apple

shares at $475 or $450 (vs. current

market price $543)? What if you even
get paid if the stock is not given to you
at $450 in next 50 days?
Equity options investors (or physical
metal, grains where delivery is applicable) can
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11

build their stock portfolio at the prices which is much

lower than current market price. Using few easy-tolearn skills, even an individual investor can
build his long term stock portfolio at lower
than current market prices following a
systemic approach. It is simple mathematics
that anyone with simple addition/subtraction
skills can do it.
It is like buying a house (but with a huge
difference).
Lets assume, you want to buy a house but
at your price. The house-owner is not willing
to sell you right now at your price.

HOWEVER, the house-owner tells you

that he would pay you certain amount if he
decides not to sell the house to you in
next, say for example, 90 days!!!
Similarly, if you are not given the shares of
the company YOU chose, at the price YOU
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12

decided during the time frame YOU chose,

YOU WILL BE PAID and you can do it
again, and then again.
You choose the company, you choose the
Price!
Let us know if you need help or have
questions
Ask@OptionPundit.com

Optionpundit.com

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Generate
Consistent Income

on Your Stock
Holdings

What

if

you

could

generate

additional regular income on your

stocks?
Imagine buying a house, then renting it
monthly to collect income. That is an excellent
way of monthly cash flow that riches of world
do it. However, there is an advantage of being
Optionpundit.com
14

an Option Trader. In case of a house, you may

not find a tenant. But in case of stocks, there
are ample tenants.
Most buy-and-hold investors keep stocks
in their portfolio expecting huge runs in the
long run. But when markets are going nowhere, your stocks earn NOTHING except
the dividends.
With few simple skills, one can learn how
to enhance yield on existing stock portfolio. In
fact, these strategies outperform pure buy-andhold strategy in 3 out of 4 scenarios1. When your stock is going no-where
2. When stock is selling-off
3. When the stock is moving up
moderately.
The only time, these simple techniques
underperform is when there is a sudden, huge
rally in the stock. In fact, there are very simple
Optionpundit.com
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ways to increase returns even in such

scenarios.
Such strategies provide cushion against
moderate market drops and over a period of
time, the credit alone (similar to rent in case of
a house) will make your stock purchase FREE.
Let us know if you need help or have
questions
Ask@OptionPundit.com

Optionpundit.com

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Regular Monthly
Cash Flow

What if you could generate monthly

cash flow whether markets go up, down
or no-where?
Options is probably the only asset class
that is so versatile to offer opportunities for
various scenarios like no other. Most other
investment vehicle are focused on CAPITAL
APPRECIATION (Buy low/ Sell High or
Optionpundit.com
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vice versa) while options can be utilized for

regular monthly CASH FLOW (as well as for
capital appreciation).
Options are based on mathematics and
pricing is determined by a formula. It is a time
decaying asset. There are only two types
CALL and PUT, one benefits from upside
move in the stock while other benefits from
the downside move. You can create almost
infinite possibilities with options.
You can structure NON-DIRECTIONAL
(i.e. it can make money whether underlying
goes up or down) strategies that are
LIMITED RISK in nature while still offering
GREAT REWARDS.
Though there are tremendous possibilities,
based on our decade+ experience, we can tell
you that it is only 4-5 strategies that make up
for almost 80% of the gains.
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18

There is NO NEED to search for the best

stock. There is NO NEED to scan the
universe for quality stocks. There is NO
NEED to analyze companys Balance sheet,
Cash flow, Profit & Loss statements as those
market neutral strategies are aimed to benefit
from options and underlying stocks
characteristics.
While this is easy to learn and understand,
doing this requires practice and experience.
Let us know if you need help or have
questions
Ask@OptionPundit.com

After reading this, you may ask if Options

Trading is so easy, why everyone isnt doing it.
And why majority of Options Traders fail
(some say > 90% of Options Traders fail).
This brings me to the final point Optionpundit.com

19

Leverage, Multiply,
Supercharge

What if you could covert $5K into

$1million?
Inappropriate usage of leverage is where
most traders fail. Theoretically, and in some
case practically, a small sum of money can
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20

convert into huge sums. It is this possibility

that attracts novice traders to enter into
options trading. Since most are familiar with
BUY and SELL (and HOLD), they start
trading options along the same principles
without really understanding how options
work.
This attracts the untrained side of traders
and investors. They think by investing small
sums, they can hugely profit from the
direction i.e. up or down.
An example most often sighted isTo buy 1,000 Shares of Apple Inc. (TickerAAPL) you need $543,000 (assuming $543 current
market price). If Apple goes to $600 in 3 month, your
stock gains are $57,000 thus gaining +10.5%.
What if you purchased 10 AAPL APR14 call
options (3months, 550 strike) for $29,500 and if it
goes to $600, your gains will be $20,500 thus gaining
Optionpundit.com

21

+69.5%!!!
Thats almost 6 times more money using
Options vs stocks. How cool is that?
And it is just the beginning. You could
increase these returns even many more folds
using various other types of options (e.g.
shorter time frame).
This logic and the potential risk/reward
are easy to understand and satisfy our internal
desires to make money in the shortest time.
But it is not easy to predict stocks
direction. This is where specialized skills in
predicting the stock moves come into play and
hence search of a holy grail to predict stocks
move.
"Long ago, Sir Isaac Newton gave us three laws of
motion, which were the work of genius. But Sir Isaacs
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22

talents didnt extend to investing: He lost a bundle in

the South Sea Bubble, explaining later, I can
calculate the movement of the stars, but not the
madness of men. If he had not been traumatized by
this loss, Sir Isaac might well have gone on to discover
the Fourth Law of Motion: For investors as a

whole, returns decrease as motion

increases."
-Warren Buffet/ Source: Letters to shareholders,
2005
Since amount to be invested tends to be
fraction vs buying shares, majority of option
traders also tend to overtrade resulting into
poor outcome.
So when do one use options to leverage?
If you have a PROVEN system to predict
underlying stock direction, if you have
specialized skill set to understand what is
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23

going drive a particular underlying stock or

commoditys prices, if you can envision any
potential merger & acquisitions and many
more.
Bottom-line: If you have a specialized skill
set to forecast underlying assets price move,
you should learn how to trade options well so
you could benefit from your specialized skill to
multiple your returns.
Let us know if you need help or have
questions
Ask@OptionPundit.com

Optionpundit.com

24

In Search of a
Holy Grail

Where Do You Go From Here?

Congratulations for making it this far. You
have now been exposed to some of the most
powerful and effective reasons available for
succeeding in Options Trading business.
While options are one of the greatest
wealth building tools available to common
investors, many still fail as they dont do it
Optionpundit.com

25

properly.
No matter how compelling these reasons
are, just being exposed to them is not enough.
You must also do something with them. In
order for you to get the most value out of this
knowledge, you might want to consider
developing a step-by-step action plan.
Just like any other regular business,
TRADING is a BUSINESS too and in order
to maximize benefits from it, one needs to
have right mind-set before diving in.
Before you start, let me answer most
commonly asked questions-

DOES IT WORK?
IS IT EASY?
CAN I DO IT?
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26

The answer to all three is a resounding YES!!

If you are a business owner, or a trader,

sooner or later options skills are going to be
useful. However, it is dependent upon
SKILLs, SYSTEM and SUPPORT you have
before you begin your real journey.
Find a good mentor who can shorten your
learning curve and save you fortune by
transferring his skills to you. Dont choose
someone randomly. Ask for student referrals
and speak to them. This will provide you with
Truth, Authenticity and Proof before you
make a commitment. Invest time wisely.
Though your coach or mentor will provide
you with tools, systems to help you get started,
you will have to develop your own system. A
system is something that will continue to
produce results which are duplicable and
Optionpundit.com

27

transferable. It is the system that will enable you

to do more with less time.
If you are looking for a quick start, you
may want to start reading about Options at
www.OptionPundit.com.
OptionPundit.com is dedicated to options
trading and contains over 800 posts and
articles. There is also a huge collection of
powerful tools, all absolutely FREE at no cost
to you.
Alternately you can approach me at
Ask@OptionPundit.com anytime and I would
love, absolutely adore to personally answer any
questions you might have.
Now you
SUPPORT

have

the

reasonsand

GO FOR IT!
Optionpundit.com

28

Scan the QR code or go to

OPTIONPUNDIT.COM to find out more.

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