Trading Options Successfully for the Long Term

Over the past ten years I have been a full-time trader and options trading mentor. I have found that becoming a mentor, and coaching students all day, has helped my own trading  immensely.

Trading Successfully

As a mentor I see  day in and day out what works and what doesn’t, So whenever someone asks me how can I trade options successfully I speak through the experience of the hundreds of students that I have mentored over the years.

The most important component to being a successful options trader is to have a plan. The plan is what will I trade, how will I trade it, what will my profit goal be and what will my max loss be.

Before Entering a Trade

A very important part of the plan is to  find a valid option strategy and having a good understanding of how the chosen vehicle moves. Once I enter a trade how will I manage it if it works for me or if it happens to work against me how can I hedge my risk and how can I adjust my trade.

These are all very important things you must know before you ever enter a trade.

Unforeseen Conditions

Many times I see traders who  have a plan, but the plan goes out the window once they are confronted with any unforeseen conditions and recklessness and indecisiveness ensues.  So  stick with your plan and adjust  only if needed, not following every emotion and whim that arises while you are in a trade.

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I think it’s also important with the trade not only having a strategy and a plan but to have trading  goals. You should keep a written record of your trading goals and your trade results over time so you can see for yourself what works for you and what doesn’t, and make changes along the way.

Risk management is so key as well as a max loss number and adjustment plans.

Many times when you are trying to make a monthly living in options trading it’s really not how much money you make when you win, but losing the least amount on a loser.

Profit Goal

If you have a 10% profit goal a month and you are successful most months, that will work if you keep your losses to 10 or 15% the months  you lose, but if you are losing 30% and 40% in bad months that will become a problem.

Lastly, you need some accountability. I found for myself and for other traders if you have someone to talk to about your trades and to give you a second set of eyes to look at them and give you some guidance will do great things for your trading and take you to new levels of ability and success.

One on One Mentoring

At Sheridan Mentoring that’s why we feel that one on one mentoring is the best process for developing traders. Trading can often be solitary and being on your own you can tend to lose your way.

Having  someone checking in with you that can keep you accountable will keep you on the right track and make your trading much more successful. We at Sheridan options mentoring are here to help you with your planning and educational needs.

Mark Fenton

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