Eight Easy Tips That Can Turn Your Trades From Losers to Winners

| January 4, 2022

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There are many profitable option trading strategies, but none of them will work unless you are willing to stick to a set of guiding principles. Several rules I employ are helpful in maximizing profits, limiting losses and, most importantly, taking the emotion out of trading.

Below, I will go over my basic trading philosophy, why I decide to take profits or cut losses when I do and how these decisions can be used to limit risk.

1. Taking Profits

My expectation for every option trade is at least a 100% return. Once a trade reaches a 100% return, we can either:

  • Exit the trade completely, or:
  • Sell half—or even a third—of the position, place a protective stop on the remaining position and keep riding the wave

Once the option premium has reached my target, I typically close the position and move on to the next trade. As an alternative, if the 100% profit target is reached, I might…

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The post Eight Easy Tips That Can Turn Your Trades From Losers to Winners originally appeared at Investors Alley.

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Category: Options Trading Strategies

About the Author ()

Adrian Collins works as an Outreach Manager at Option Dash. Option Dash is always looking forward to offering the best covered call and cash secured put screener on the internet. Adrian is passionate about spreading knowledge on stock and options trading for the rising investors.