your Questions Answered

Additional Information

How do I get my question answered?


Send an email to support@optionelements.com. Tony attempts to answer phone calls throughout the day as well.  Call 404-271-9777.  The best way to contact us is via email.


Can the courses be downloaded and viewed at any time? 


Yes.  All courses were originally taught live and can now be downloaded to your device and viewed at your convenience.   


What training should I take in order to be able to have the kind of results you have?


We suggest that if you are a beginning options trader, you should start with the Course on Butterflies and Condors.  Then proceed to the course on Trading the Weekly Options.  After that you should start on the course Option Combinations Strategies.  Follow that up with the course on Managing by the Greeks. 


How can I know that your courses are right for me?


You could start by reviewing the many testimonials we have from our customers.  Also, the first class in each training course we offer is free for you to download.  By reviewing the first class for free.  If you want to become the best Options Trader you can be and learn to be consistently profitable, then this material is right for you.


I live in another country.  How would the time difference effect my experience with Option Elements?


We have customers located all around the world.  Naturally you will have to make time for your trading during normal U.S. market hours.  


Do you use hypothetical examples of trades in your teaching, or are they real trades with real money?


All trade examples are real trades with real money.  Courses are updated periodically with live trades in the current market conditions. 


When you would employ a ratio spread as part of a combination trade?


1. The ratio spread can either be “covered” or not.  In a portfolio margin account you could place a ratio spread, of say, long 10 and short 20.  In a REGT account, you would cover those naked options and buy the additional 10 lots as far away from your short options as your margin requirement will allow.  That mimics the naked options without the massive margin requirement.


2. A ratio spread is a Negative Vega trade.  That alone can be ok, but it depends on whether you are in the calls or the puts.  In a higher IV environment, after a certain amount of decline in the market, that would be a good time start a ratio spread in the puts or the calls.


3. I personally still like to have some sort of gear in place to protect that ratio spread to a certain degree.  Because a ratio spread will gain in deltas (+ or -) as the underlying gets between the long options and the short ones.


4. In a period of low IV, it's important to protect the ratio spread using management by the Greeks.  That said, I love ratio spreads.  They can perform very well when placed correctly, and they are easy to manage as long as we don’t let the market run too far against our shorts. (maintain a reasonable Delta/Theta ratio).


 Trading


What advice do you give someone who has marginal success trading but is motivated to learn more? How would that person get the most out of the members site?


Review all the free videos we have for the 1st class in each of the courses we offer.  Then, look at the screen captures of the various trades in the members area where we follow trades from start to finish.  Listen to the trading room recordings that are in the library.  Every trading room session is recorded and rendered in various formats for you to watch on any device you choose.  We have over 400 trading room session recorded.  And above all, ASK QUESTIONS.  Also, it would not hurt to pick one or two of the pre-recorded courses and invest in those so you have them to keep as your own.


Is the Christmas season ok to trade, or should you be out of the market?


I find it best to be out of the market during the Christmas to New Year’s time frame. Even the first week or two of January can be volatile sometimes. It's just a personal preference. 


I’m was comparing my charting software to your posted OptionVue trade projection chart. There seems to be a difference in how the graph looks and the Greeks on my software compared to yours. Can you explain why OptionVue shows the overall trade being looking slightly different than mine?


I can’t speak to the mathematical calculations of the other software programs on the market, but many of them use the basic Black/Scholes pricing model which I find to be somewhat inaccurate in several ways. Many programs don’t have the capability to calculate what we call “True Delta & Gamma”.  True delta/gamma calculations take into account the effect that volatility has on the price of the options.  Vol is on a curve just like Delta and Gamma and the software you use may not be dynamic and not take into account the effects of Vol on the deltas. Most of the time I use the “variable” model in OptionVue because I expect changes in IV.  The variable model, in conjunction with the true delta and gamma, produces the most reliable graphical analysis towards the edges of your profit/loss graph.


I have read many books about options strategies, most are difficult to decipher? Do you explain things in common language?


Naturally we use the correct professional language and terms specific to Options Trading, but we try to explain those terms and meanings in a more descriptive manner with plenty of examples to clarify things.  Once you are used to the terminology we use, you will quickly become comfortable with the language.  We have English and Spanish languages.   Tony expects you already know the basics about options, including what the option Greeks are as he uses them a lot. The main Greeks to understand are Delta, Theta and Vega and Gamma.  Example: Gamma controls how curved the profit/loss chart is. (Low Gamma = flat line; high Gamma = line is curved more towards profit/loss).


I would like to know what strategies are best to utilize when you have Low Vols and when you have High Vols. How long a period you put a trade under both (low & high vol) environment.


In a low Implied Volatility environment, its best to use tactics that, when combined will produce a long Vega component of your trade.  At the very least, you should have your  Vega no more than double your Theta.  It doesn’t matter if Vega is positive or negative. That should be considered a “Neutral Vega” posture.  When your position Vega gets to be 2 or 3 times your Theta, that’s a rather long (or short) Vega posture.  In a low IV situation, the tactics would be Debit Spreads (long put spreads), Calendars and Diagonals.  One or two of those combined with your credit spreads should be used.  In the high IV situation, Credit Spreads, Butterflies, Time Spreads, and Ratio Spreads would be the tactics to use.


At what point (value) does Gamma become a concern?


Gamma can become a concern when your trade gets close toward expiration.  What I mean by close is under 10 days to expiration.  Also, if you have a position which exhibits a large sharp profit tent (like a calendar or Butterfly() and your profit is nearing half the maximum (average) profit for trade, your gamma will start to effect Delta in big way.


Is OptionVue required to analyze positions or will Think or Swim suffice?


OptionVue software is not required to analyze your positions if you wish to mimic my positions. Many of our subscribers use other analytical programs. These other analytical programs are sufficient for success with Option Elements. I prefer OptionVue personally and have used that program for about 17 years.


Legal Disclaimer


Option Elements is NOT a Broker Dealer. Option Elements engages in trader education,training and the professional management of client accounts. Option Elements offers a number of products and services via the internet at optionelements.com. Option Elements offers web-based, interactive training courses on demand.


The webinars and seminars given by Option Elements are for educational purposes only. This information neither is, nor should be construed, as an offer, or a solicitation of an offer, to buy or sell securities. You shall be fully responsible for any investment decision you make, and such decisions will be based solely on your evaluation of your financial circumstances, investment objectives, risk tolerance, and liquidity needs.


Options involve risks and are not suitable for all investors. Prior to buying or selling an option, you must receive a copy of Characteristics and Risks of Standardized Options. Copies are available from your broker, by calling 1-888-OPTIONS, or at www.theocc.com. The information on this web site is provided solely for general education and information purposes. No statement should be construed as a recommendation to buy or sell a security or to provide investment advice. You are fully responsible for any investment decisions you make. Such decisions should be based solely on your evaluation of your financial circumstances. Such decisions should be based solely on your evaluation of your financial circumstances, investment objectives, risk tolerance and liquidity needs. Supporting documentation for any claims, comparisons, statistics or other technical data in this presentation is available at Option Elements (info@optionelements.com).


Past performance is not necessarily indicative of future results.  Parameters relating to past performance of strategies discussed are not capable of being duplicated. In order to simplify the computations, slippage, commissions, fees, margin interest and taxes are not included in the examples used on this web site.  These costs will impact the outcome of all stock and options transactions and must be considered prior to entering into any transactions. Multiple leg strategies involve multiple commission charges. Brokerage firms may require customers to post higher margins than the minimum margins specified on this web site. Investors should consult their tax advisor about any potential tax consequences. Simulated trading programs are designed with the benefit of hindsight. No representation is being made that any portfolio or trade will, or is likely to, achieve profits or losses similar to those shown. All investments and trades carry risk

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