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Portfolio Management

Portfolio Management

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To properly manage your portfolio, you need to know how to monitor your positions, determine proper allocation size, and reduce margin requirements.
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Summary

When I say "portfolio management," some people automatically assume you need a Masters from MIT to understand the concept and strategies - that is NOT the case. In this module you'll see why managing your risk when trading is actually quite simple. Of course, you do need to use simple checks and balances to help remove your emotions and make your trading more systematic.


Objectives
  • Quick pep talk on the importance of patience and letting the math play out.
  • Scaling or adjusting position orders and contract numbers to keep positions sizes small.
  • Monitoring positions and creating automatic alerts for key adjustment levels.
  • Beta-weighting your portfolio and using one benchmark index for determining balance.

16 lessons

No Guaranteed Trades

There are no guaranteed trades. As an active options trader, you will have winning trades and losing trades. Sticking to the trade plan, remaining consistent, and mechanically entering trades is an important part of portfolio management.
4:36

Don't Do Something, Sit There

Sometimes it's better to do nothing and be patient when it comes to options trading.
6:37

Account Size Adjustments

Not all trading accounts should be allocated exactly the same. There are trade size adjustments you need to make based on your chosen strategy, number of trades, account size, and more.
6:00

Avoiding Stock Market Overload

Avoiding stock market overload is key to your long-term success. Too much information is distracting and can drawn your attention away from what is most important. Here is what to quickly look for in the morning to have market awareness about your positions.
4:18

Stocks, Indexes & ETFs

What's the difference between trading stocks, indexes, and ETFs? Learn about the pros and cons of each in this lesson.
7:18

Monitoring Positions

Monitoring positions does not have to be a time consuming process. In this video, learn when and how to monitor positions for potentail closing or adjusting orders.
5:19

Creating Automatic Alerts

Create automatic email alerts for your positions to help you know when an adjustment might be necessary.
4:53

Individual Stock Beta

Individual stock beta measures how much a particular stock might move when the market moves up or down. The higher the beta, the more volatile the stock compared to the market, and vice versa.
3:34

Portfolio Beta

Your portfolio beta is a good way to manage risk because it quantifies the direction of your portfolio's tilt. Learn how to use portfolio beta to balance your portfolio.
4:53

Beta Weighting Your Portfolio

Beta weighting your portfolio gives you a sense of how bullish or bearish your portfolio is positioned. By balancing your portfolio with beta, you can know what types of positions to add to stay neutral.
8:43

Uncorrelated Industries/Sectors

In addition to the diversification benefits of having multiple stocks in a portfolio, diversifying across uncorrelated industries and sectors is an important aspect of portfolio management.
4:43

Systematic vs Unsystematic Risk

Risk is broken down into systematic risk and unsystematic risk. Learn the difference between the two types of risk and how they impact your portfolio.
5:10

Efficient Portfolio Frontier

The basics of risk and reward are essential to portfolio management. The efficient portfolio frontier combines different securities for the best return relative to risk.
9:58

Limiting Undefined Risk Trades

Limiting undefined risk trades is vital as you manage risk and grow your account. Option strategies with undefined risk require more capital and may not be optimal for all account types.
3:26

Economic Calendar

Some economic reports are more significant and have a greater affect on the stock market, which is why it is important to be aware of the economic calendar.
2:34

Concept of Legging

The concept of legging into and out of trades is where you would enter one side or one part of a trade and then later add the other side or part.
6:26
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Our guided videos are always available to you. There is no membership required, and they're always free to access.

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Our free courses include more than 160 videos on options trading. Learn the basics of options and key terms, options pricing, multiple strategies for beginner and advanced traders, trade adjustments, portfolio management, and more. Option Alpha's education is designed to help you understand every aspect of options trading with in-depth, easy-to-follow guided videos.

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Kirk Du Plessis
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