Don’t Gamble on Your Next Trade…

Some people think stock market trading is nothing but gambling.

But that couldn’t be further from the truth…

Sure, it’s fun to go out and throw a couple of bucks around at the horse track. Sometimes I talk a couple of buddies into going down to the harness races on a slow weekend. But picking winners is practically random — especially at the harness races where it seems they can slow down the cart behind the horse.

When I was younger, I used to make the pilgrimage to Las Vegas the first week of March Madness. I had a good analytical system to help place my bets — and it was quite a rush watching dozens of games simultaneously at the sportsbook.

However, the silliness of seeing a meaningless basket blow up the spread at the end of the game was an all-too-often reminder that even with a good system — this was strictly gambling.

Of course, betting on 16 games on Thursday and Friday and another 8 games on Saturday and Sunday was exhausting! I was happy to go back to work Monday where I can quantify my odds and relax doing what I do best — trading the markets.

As you can see, I’m not much of a gambler. I like to control the odds and know I have an edge like we do with our options plays. Trading is all about probability and money management… not gambling!

Save your crazy bets for Vegas…

Keep it In the Money,

Alan Knuckman

Alan Knuckman
Editor, In-The-Money

Trading Tip of the Day: Get tactical following this month’s hard reset

Greg GuenthnerMarket conditions are constantly changing — and it’s our job as traders to figure out when it’s time to go all in, and when we’re better off sitting on our hands.

Remember, we’ve enjoyed an incredible recovery rally off the March lows. Led by the household name tech stocks and the upstart “shutdown stocks” that have recently captured investor’s imaginations, fast gains have been ours for the taking.

But this month has brought with it a hard reset in the markets, along with some choppy action. As the market adjusts and some of the strongest performers consolidate, we must follow their lead.

Randomly buying the hottest, soaring tech names just won’t cut it right now. Instead, it’s time to get tactical. Pay close attention to price and emerging trends. That’s your best shot at finding the market’s next big winners.

— Greg Guenthner

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Alan Knuckman

Alan hails from the home of options trading in Chicago, where he began working as a clerk on the floor of the Chicago Board of Trade (CBOT). Beginning with his days on the floor, Alan’s worked with all aspects of the options markets for the past 25+ years.

Transitioning from a clerk to a floor...

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