Allocation

Black swan events are economic anomalies that can neither be predicted nor avoided, but their rare occurrences can be properly planned for to mitigate the effects.

Options trading is just a game of numbers and probabilities. Responsible trade size and available cash reserves give you the best chance at success over a long period of time.

Here is a straightforward, 5-step process teaching you how to consistently generate income trading options.

Never allocate your account's entire capital when trading options. Your maximum capital usage should be around 50-60% of your total account, and you should keep about 40-50% cash on hand at available all times.

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.

Options trading is a game of numbers. To have confidence in a trading strategy you have to understand the long-term expectancy. Probabilities and position sizing are paramount.

Options contracts are leveraged financial instruments. Learn how to smartly use leverage to your advantage trading options.