Good day all,
I recently received a question asking about “slingshot trading options,” and to be candid, I knew little about it, so I did some research, and, as usual, a little research is always so enlightening …
Basically, the concept is similar to swing trading options. You buy, hold for anywhere for 3 days to two weeks, and then sell. The basic idea is to take advantage of movement inside the 30-day expiration period of options. Theoretically, slingshot trading options increases profit by increasing leverage. Okay, the idea is interesting, but …
In the world of trading, you will find those who have “found the secret” to trading success, a system that virtually ensures you will make money. These people then make their money on selling you their secret system. Although some might call them charlatans or see them as selling “snake oil,” the truth is they have found the secret to trading successfully. The irony is that their “secret” is not actually a secret at all. These purveyors of success are selling you a trading system based on the fundamental notion that in order to achieve trading success, one needs to remove emotion from the trading process. My friends, although you might find a “turn-key” successful trading system on the market, the truth is you can develop your own “system.”
Granted, many trading systems are designed to do all of the work for you, meaning those behind the system find the trade, define the entry/exit positions, and then give that to you for a price. Certainly, this removes ALL emotion from the act of trading. The question arises, though, do these turn-key systems work?
On the other hand, some trading systems are well-designed software packages that give you the tools to find and execute trades automatically, which means you find the trade and the software does the rest. In my opinion, this type of trading system is superior to the former.
Slingshot options trading is just another way to trade options. I see nothing magical about it. My warning to you, though, is remember the snake-oil salesman is out there waiting to take your money with promises of “easy money” if you buy into their “secret” system. To exemplify my point, I close with two headlines found on two websites promoting slingshot options trading.
- The Slingshot Option: An Extremely Easy Way For You to Triple Your Gains on Gold
- Today could be the day you are allowed access into this secret society of members who are "stripping the stock and options markets bare" from week to week!
Sling shot, swing, position, guerilla, or day all describe a way to trade. None, however, describes automatic success. No matter the timeframe, successful trading still requires a trader to work at trading. If it were as easy as buying a “secret system,” wouldn’t we all just do that and forget about the work? Wouldn’t we all just make our billions and retire?
Trade in the day; invest in your life …