Manage episode 279681254 series 2134820
Check this out: High Probability Trading LIVE
Hey, passive traders, how's it going today? Listen, we're thinking about doing a two-day live event. Not sure yet if it's going to happen or not, but the information is at optiongenius.com/live. If you want to be on the announcement list, just go ahead and go to that website and put in your email and your name, and we will let you know. And if we've decided that we're going to do it, then the information to figure it out and sign up is going to be there as well. It’s going to be two days of content, hard hitting trading content. And I'm probably gonna bring in some guest speakers as well.
So I'm getting excited, the more I think about it, the more excited I'm getting. But I am very nervous because I'm super introverted and for me to do something like you know, we're meeting a lot of people. So that's why it's virtual. I don't have to go in front of a large stage or anything, but it is going to be really cool. So I'm already starting to think of what topics we can talk about what is the, you know, what's the best, that will help everybody. And so if you have any ideas of what you would like us to talk about, you know, go ahead and fill out that the name and email at that page, option, genius, comm slash live. And then let me know what you think. And let me know what you want to hear about. Cool.
Alright, so I got an email today from a reader of the passive trading book. And I thought that this could be a pretty good episode based on what she said. So she said that she loved the book, she went through it, it was great, she learned a lot. And she's really, really focused on doing it. And she's, uh, she's already in real estate. So she understands the whole options and how they work and how they relate to stocks.
Now, the problem is that she's only got a couple $100 to work with. So what should she do? Now, this is a very common situation, it's a very common problem that a lot of people have, they want to get started, they love the idea, but they don't have money to trade. And obviously, yeah, it takes money to trade, right? This is the one thing it takes money to do everything but especially trading, it does take money to get started. So what do they do, and on this episode, I'm going to give you some idea and it's actually a controversial idea, because it's not right for everybody, it might be right for you, it might not be right for you might be the most awful advice that anybody could ever give you. So I'm not giving you advice, per se, I'm giving you an idea. You have to know yourself. And you have to know if this is the right thing for you.
If it's you know, too much or too risky for you, then don't do it. If you think you can handle it, then it might be the opportunity or the idea that finds you the funds that you can go and start trading. And you've probably already thought about this, but I want to go through with you a little bit more. So my first ever trade was not stock. It was a commodity trade. And I was I don't know what I was like 12, 13 years old. And we got this pamphlet in the mail. It was a brochure, it was like a sales letter for a course on how to trade futures. And I read it, I was mesmerized. I'm like, Oh, this is awesome. This is awesome. Dad, we got to get this, we got to get this. So we paid a couple of 100 bucks, whatever got the manual in the mail, opened up a futures account. And we traded soybeans, and I still remember this. We traded soybeans, one contract, and we made $25000. And I was on top of the moon. It was awesome. And then my dad shut down the account. I'm like, What happened?
He goes, No, no, no, I didn't want to keep doing this. I just wanted, to show you what it was like and the actual idea that he had was that he was going to open the account, and we were going to lose money. And then that would stop me from ever wanting to trade again. Because he thought that commodities trading commodities was very, very risky and not do it. His whole thing backfired on him because he wanted to teach me he wanted me to lose money to teach me not to do this. And in fact, the opposite happened. We made money and the bug I got the bug - it bit me and ever since then I wanted to trade, but he shut it down. I didn't have any choice, right. I was too little.
Fast forward and in the future. I have just dropped out of college. I came back home to help my dad with a new business he owned he just bought and things were really money was really, really tight. I mean really, really, really tight. To the point where like we don't, we're hoping we have enough money to eat every month. Even less than hand to mouth. And so in the mail, I get another brochure about a course about trading futures. And this one was even better than the first one because this one talks about technical analysis and the guy will actually help you with recorded messages to tell you what he's trading and bla bla bla bla. And, you know, times are so tough. I'm like Dad, we need to do something, I want to do this. How do we do this? So we bought the course. And I started following it. And at that time, this was pre website, or pre, you know what, they didn't have websites. We had AOL and stuff like that. But they didn't have Google, Yahoo, any of this stuff.
So the charts had to come in the mail, you had to subscribe to a service. And they would print out the charts every week, at the end of the week, and they would mail them to us, he get them by Monday. So you'd have the charts and they would be newspaper size. And then every day, whatever happened, you would have to fill in the chart, you'd have to draw your lines, your support, resistance, all that stuff. And then every week, you would get a new set of charts. So you have to draw the lines again. And that was really a good way to learn for one thing, but I did it for a while and I show my Dad, I'm like, Look, Dad, I'm doing really, really good. I want to do that. So he went ahead, and he borrowed $8,000 on a credit card.
So he took a cash advance on a credit card, he gave it to me, we opened up a futures trading account. And I knew that this was all the money we had. So we didn't even have it. Right? We didn't even have it. And at this point for him, it was a like a last-ditch effort. Like hopefully this works. If it doesn't, well, we're not gonna be able to pay off these cards anyway. So credit goes to hell kind of thing. I think this was the last card he had with any remaining balance. So yeah, you know, no, no pressure, right? Anyway, so you know, I'm going through all the charts I'm looking for the perfect opportunity, the perfect trade, the perfect trade. Finally, I find one and I'm like, Oh, this is it. This is gonna work. It's an uptrend. It's going great. Following all the lines, all the sports, everything, okay, Dad, I'm doing this, I put my first trade on one contract on the Japanese yen, Japanese yen was going up, it was gonna make me and I was gonna make a fortune. So I put the trade on close to the end of the day, and put my stop loss in. And that's it, I go home. And at night, I'm thinking man, I'm under how much money I'm gonna make or how much money I'm gonna make.
I'm gonna pay all the bills, life is gonna be good. All this stuff. The next day I wake up, you know, I get to get to the office, I check. Oh, Yen is up, Yen is up alright. I'm making money, how much money do I make how much money they make in my account. And there's like $23 in my account. And I'm like, wait, what happened? Where's my Japanese yen contract? And there's no contract. And only wait, I bought a contract yesterday? Well, this must be like a glitch or something. I don't know, am I right? Am I signing in to the wrong account, what the heck is going on. And then I looked further. And it said that it stopped me out of the trade earlier in the day at the open. And when wait this doesn't make any sense. And so then I went back and I looked at it again. And basically what happened was, the Yen had gapped lower at the open. And then when it finally did open, it went up all day. But it opened lower, much lower than my stop loss. And so as soon as it opened, very, very low - hat's when my order was executed. And I was kicked out of my trade. And then that basically took away everything in the account. All eight grand was gone. overnight. One trade.
And the sad part was the really frustrating part was that that trade would have made 1000s and 1000s of dollars because the Japanese yen continued to rise. Now, what's the moral of the story? What's the lesson to be learned here? I don't know, if you're gonna trade Yen, you got to have a lot more liquid because it moves up and down. I guess. That's one Moral of the story. But the reason I'm bringing this story up is that the idea is to do what we did. There's a potential to borrow money to trade with.
And so I was talking to a fellow. And what he does is he works with companies like mine, where we're selling programs, right coaching programs that are not super expensive, but they're not dirt cheap either. So people might like to finance it. And so this guy, he works with several banks, and basically, he wanted to offer financing to my customers. Now, I don't know how I feel about that. He knows like if you can't afford the program, should you borrow money for the program? I think I'm okay with that. But if you don't have the money for the program, then how are you going to trade? Right, I don't want to take I don't want you to borrow money to buy a program and then not have anything left over to trade unless you know that that's the plan unless you say, yeah, you know what, I'm going to be paper-trading for a while until I learn, and then I'm going to invest the money, and then I'm going to do it. So when I was talking to him, what he was saying is that the way their program works is you, let's say, you come to me and you say, hey, I want to join your program, I want to finance it. So the Okay, so I turn it over to him. And they have a form that you fill out, it's a personal loan, and they they work with the world's largest banks, right. So it's not like some, some little corner shop, these are real big banks, and they look at your information. And then they put give you an offer, they say, all right, we will offer you $10,000, we will offer you 20,000 will offer you 30,000 as a loan, and these are the terms this is the interest that you could pay every month, etc. And then if you like it, then you say yes, or no.
Or if you don't want the whole amount, if you don't need the 30,000, you take, you know, I'll say I need 10,000, I need 5000 or 2000, or whatever you want to take, you can you can take that amount. Once you have that money, then my company charges you for our program, whatever the cost is that you agree to. And that's how it works. And then you make the payments directly to the bank. So I was thinking about I think, wait a minute. So you're telling me that the people, the customers, my customers can borrow more than the program is cost? And he said, Yeah, they can. So I thought that was very interesting, I think, well, if somebody wants to, so they have good credit, they can borrow enough to pay for the program, and they can borrow the money to trade with. So that way they take the money that they're trading with, they earn a profit on that, and they use that profit to make the payments. So in essence, they're getting it for free.
They're just working for it, but they're using their profits to pay off the loan. And that would be an amazing way to get started very quickly. And he said, Yeah, technically, they could do that if they wanted to. So that's interesting, you know, so I'm still thinking about whether we should do that or not. If you're interested in something like that, let me know the good and the bad, you know, because I'm thinking about it, I'm still debating it, I don't know if it's a good thing. For some people, it can definitely work. I've seen people that it has worked for where they've borrowed money to trade with, and they've done really, really well.
And I've seen other people blow up, there was a guy on Facebook. And he he posted that he borrowed $200 on a credit card where he was going to have a 0% interest rate for one year. And he borrowed $200 on his credit card, he's going to use that $200 to trade with. And I'm scratching my head, I'm like, Dude, what are you gonna do with 200 bucks, you're gonna buy some calls, hopefully, you'll make some money, hopefully, you'll be able to pay it off. But you got to make 100% in a year, you're it's a crapshoot, right 50% chance you're gonna make 50 million, you're gonna lose it all. But I don't know, maybe he's gonna make it. But if he's only using $200, I have a feeling he doesn't know what the heck he's doing, he's probably gonna lose it $200. And, well, it's not a big deal, he's gonna have to pay back the credit card, I don't know why you would only borrow 200 though.
Geez, if you if your bank is only going to give you a line of credit on a credit card of $200, you got bigger problems, you don't need to be trading, go get a job. But the thing here is, this might be a way for you to get started. So either you borrow money from a friend, you borrow money from the bank, you borrow money from somewhere else, I wouldn't advise you to borrow money from your credit card like my dad did on this, you probably knew that, hey, you know, this is a sinking ship, we might not be able to pay it, that's a bad thing. You shouldn't borrow money that you can afford to pay back. Right? So hopefully, you're not in a situation where you do have to borrow money. But if you are, please think about it before you do. Most of the time, when you borrow money, people are under a lot of pressure. And they feel that they have to pay it off right away. And so they take risks that they shouldn't necessarily take and they blow up, they lose all the money that they borrowed. And then not only do they feel really horrible about losing money, but then they still have to pay back the bank. And that can mess up their credit, they can mess up their relationship with their spouse. So you really really have to think this through before you do it. I'm just putting it out there. It's something you've probably already thought about it.
If you've ever wanted to get into trading and you don't have any money, like, we're gonna get the money, we're gonna get the money, I still think the best way is to paper trade to learn without having the risk. And to build up a track record and the look, you know, I've been paper trading for six months. And I've done all these trades. I've done several trades every month, and I'm consistently profitable even a couple of months where, you know, I could have lost money, I could have lost a lot of money, but I didn't manage it properly. And here's my record. And then you can find somebody that can either borrow, you can borrow the money from or we'll put up the money and you trade their account and you get paid a fee for it. You know you get a piece of the profits. I would rather have you do that than borrow the money. But even if you are about to borrow the money, please paper trade it first.
Whatever you're thinking of trading paper traded first, so that you don't end up and do what I did. That's why I told you that story in the beginning because it's a warning, right? I didn't know what I was doing. I had a course. But I didn't have like a live mentor. I didn't have a group, I didn't have any community. It was just me by myself with my little charts that come every, every Monday in the mail, and I'm drawing my lines. And even though I had it, right, even though I had the trade, right, I had nailed it, I knew the direction I knew was going up, I placed the stop loss in the wrong spot. And I was trading the yen when I shouldn't have been, because my account size wasn't large enough to be able to trade the yen properly. Does that make sense? I was trading the wrong instrument. And I didn't have anybody to tell me that.
That's why we have coaching programs. That's why we do coaching calls with students. So they can tell me what they're trading and I can coach them and walk them through and say, you know what, if your account is that big, maybe you're overreaching here, maybe you need to trade more, use your feet, something else. And so we walk you through it so that you don't make that same mistake because I know how painful it can be. I know how you can do every single thing, right and still have it blow up in your face. And so if that's happened to you reach out to us get on the phone with us book a call, we can talk about it, we can tell you what we have to help you.
And I think, you know, if we need to, we can even help you figure out how to finance the program. But we'll have to make sure that it's gonna work for you first. And so that's why we get on the phone. And we have to talk to you see what your background is, if you're the right fit for the program, then we will give you an invitation to join. And then if it if need be, we can tell you how to finance it if you have to. But again, that's something that we really don't really push. And we don't encourage you to very much. Just because you're going into debt for something I don't want you to go into debt for. Right, I don't want you to start behind, I want to put the odds in your favor as much as possible. And so when you're dealing with that, you have that extra added pressure. I know what it's like to have a lot of debt. You know, at the worst, I think I had myself I had over $100,000 worth of debt. That's not even including car and mortgage and all that stuff. This was just like credit cards and stuff that I had borrowed from. And it's not easy dealing with debt. It's something it sits on your shoulder every day.
And it's a pressure that you feel, you know, you're feeling like Atlas, he was the in the Greek mythology, he was the guy that had to hold up the earth on the back on his back. And that's what it feels like, you know, there's something there on your back all the time, and you feel it. And I don't want you to go through that if you don't have to. So my point here is that I never thought I never talked about this before, I've never really mentioned it pushed it, because it is very risky. But if you need to, if you're the right person, if you feel that you're mature enough, you can handle it, you have a trading plan already that's working, that's consistent. Maybe this is the way to go.
And if you need to give us a call, reach out to us firstname.lastname@example.org is our email. If you want to get on the phone with us, we can explain how we can help you just reach out to us via email and we'll tell you what we can do email@example.com.
Oh, and if you do want to find out about that live event that we might be having, it’s optiongenius.com/live.
Alright folks, thank you and trade with the odds in your favor.
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