Options Trading Mistakes To AVOID

Here are some beginner mistakes I have seen option traders make. If you recognize and can relate to any of these, I hope my instructions will help prevent you from making future mistakes. Enjoy ! :)

If you have any suggestions for future videos such as Day Trading, Investing, Stock Market, Option Trading, Real Estate, Robinhood, TD Ameritrade, ThinkorSwim, Crypto & bitcoin, Entrepreneurship, Forex, or fun daily vlogs. Please let me know.

Keywords: thinkorswim, options, options trading, td amertitrade, trading, carmine rosato, stock trading, options, supply and demand, live trading, trade recap
#psychology #daytrading #supplydemand

[joshuarenalds]

I like to choose the option contract that is 1 or 2 away from being in the money. It depends on where the next supply/demand zone is

[masonpagano]

I’ve been learning how to trade for the last 8months, struggling the whole time.

Came across your channel 2weeks ago, and trading is finally making sense to me. Still paper trading, but holy shit, my accuracy is on another level now!

Keep it up, and your channel will grow at an insane rate

[juke]

Third straight very good week using supply and demand zones. 👍🏻👍🏻

[NJMedari]

Great video Carmen. However I had one inquiry about the first example. With a $350 if you bought 2 contracts for 1.70 at a .36 delta, a dollar move up would equate to approx. $72 profit . The 10 contract bought at $35 dollars with a .09 delta would equate to a $90 profit. So wouldn’t the latter be more effective for smaller accounts?

[wakalmercedesreyes]

thank so much my man, some guro sell this information for a lot money god bless you brother

[jacil]

I remember when you had little over 2k subscribers. now you are at 16k growing your channel slowly but surely. Always look forward to all your lessons! Thank you

[stevek]

Videos and FREE info you put out there just keeps getting better....THANX C !!!

[AA_fromtexas]

Is there any way to filter the options chain so you only see contracts that fit your filter criteria (delta > .30, low theta, high liquidity, etc)

[FMD]

Very True but there are some exceptions to the Far OTM rule. If you know a big movement of a stock and your account can handle a little lost if it goes wrong, the risk reward is massive. Last Friday i wanted to test my theory out and was willing to lose 2k it never got there. I bought a 200 strike roku for sept 25 the previous week for .25 cents a contract. Went with 100. Roku has been my go to and only time i load up on 100 contracts. Last 3 big roku run ups i hit big. Monday i got in 100 contracts @ 160 strike for 2.30 and 2.50. Avg in 50 and 50. My thinking was if the 200 fails the 160 strike more than covered it. Usually on run ups i would close out all my contracts when roku goes up 15 points. Monday when it hit my target i held a little longer because the uptrend was so strong. I ended up closing 90 contracts at 185 for 16 bucks premium and kept 10. I ended up holding those 200 strike contacts over night which i usually would never do. Those 25 cent calls ended up going up to 3.15 in premium and i sold 50 at 2.90 and 50 at $3. 2k netted me roughly 50k. I did this as a test to see how much more i could add from my 160 strike 100 contracts. I also ended up closing my 10 from Monday right before roku break 200. I would never recommend anyone doing what i did. Never hold more than 10 contracts of weeklies over night or if the premium you bought is over 5 bucks. I had alert and scanner set up for when roku hits a certain amount of volume. When it does, i get an alert telling me its institution that’s in the trade buying up roku. Moral of the story is get to know one stock and study it religiously. It is very possible to make money with a lot of contracts with far OTM weekly options but YOU HAVE TO KNOW that stock has a catalyst from news. It has definitely paid off for me. Big payouts on roku this past week, early July and also Aug 25-28 was a gift and curse. My ego got big to the point i was trading options on other stocks like FB, Shopify, Tesla, WMT and DKNG with too much size. Ended up giving back about 40k which would be about 1/4 the profit i made off roku. Before Monday, i had to go back to trading stocks only to build up my confidence again and remind myself to stay humble and that small wins each time will win. Anyone reading this trust me, when you ever get in a position where you made 30-40k within 45mins to 1 hour span. That ego will kick in and it will hurt you because you will go into winning trades and hold much longer and it will humble you. My moment came in a Tesla trade when i was up 8k and being smart decided to hold on thinking i was going to hit target to 15k. Ended up losing -15k. Keep up the good work Carmine! It because of your videos on how to trade options on TOS is how i started trading options.

[caciocavalloster]

In another one of your videos you say for day trades to play only the weeks expiry Mon & Tuesday the rest of the week to play the following weeks expiry. Which should it be?

[cheetahpsg]

All great points and all mistakes that I have made. I have had some success though trading same day expiration options though. Let me ask, if I were to hold an ITM call/ ITM put positon and don't take action to sell the option (to close) BEFORE expiration what happens to my money? I always sell the option back before market close on expiration day as I don't have the money to purchase 100 share of the underlying stock (calls) or money to buy stock at a put price that I can sell back to market for a profit (Puts) after exercising the option? Would I get the value difference between the call price and the market price? Say I have 1 $100 Call I held that is ITM and underlying stock is trading at $110 on market close expiration Friday) would it be worth 10 X 100 or $1000 AFTER the expiration? What would I have to do to get the money credited to my account? Or did I lose my chance to make any money on the option and it expires worthless unless I can purchase and sell the shares or force someone to sell me shares at the strike price?

I have had some success (and saw some crazy profits to be had) trading same day expiration options. When I was trading penny stocks and futures (ouch) and didn't know too much about this "option thing, " I did "option Thurdays and Fridays" and played calls and puts on stocks from Thurday afttermoon even into the mid afternoon on Friday. With more liquid stocks (like AAPL and BA) the gains can be tremendous if I don't FOMO out on Thursday and hold an option overnight for Friday on a non cyclical stock that is ahahaha. . Also had some success with cyclical stocks (like T and TEVA) which constantly gave me decent gains percentage wise 200- 300% when they were actually trading in a price channel. I see stuff like what happened today with BA, AAPL, and other stocks today on the rebound from a rough week and cringe that i didn't take advantage of the opportunity to make 500- 1500% on trades like these. Basically, I've had better risk/ reward % and better gains from some of my Friday "modified lotto" options than otherwise. Seems to be favorable market conditions on SOME Fridays whne there is "panic in the market" and big selloffs or desperate buy rallies late into the afternoon on Friday with stocks like AAPL especially on the call side where people want to get in and hold stock over the weekend at what is perceived a value price. This seems to drive the price for options up and up when the S&P is on a rally as I can sell the option (to close) which has value even late in the day if it goes ITM.

[opudo]

You're a trading lifesaver a true mentor the best so far WOW.

[gevkhalulyan]

Thank you very much you are a great teacher and a great human being

[Victor-vpkn]

Thank you. this really help me see heads and tails of the market and my position in the midle of the battle. I hope you can make whole lot more videos.

[cynfrombrooklyn]

Yeah I’m having that issue with appl I got in when it was going up crazy 2 March 2021 contracts and now the delta is so low i did 165 and 145 🤦‍♀️🤦‍♀️🤦‍♀️🤦‍♀️🤦‍♀️🤦‍♀️thank u for this video

[prettylilly]

I'm a newbie at options trading and this video was made for me. Had 3 bad contracts and one good one. Thank you for the content. New subscriber.

[skypods]

I messed up on a long call using weekly’s, to save on the commissions can I choose to do nothing?

[Dalytrades]

Learned a lot from this appreiciate it, just solved the missing piece in my puzzle

[Rkothebest]

Great videos! Been trying to learn options for a while now and your videos are helping a lot!

[andrenicholas]

Bro you are one of the best I have seen in this platform! I am definitely inclined to learning from you bro! I will be a member soon