Bedford, Dimitri, McIntyre, etc. Clowns?

[Hopeful]

Hi, everybody !

Recently I've been looking into options after failing to get anywhere trading stocks and futures (main reason is lack of focused time).

I like the idea of writing options for income and so have been looking into that aspect. It appeals greatly because one can set up a write or a short and hopefully not have to focus on it every day until expiry. They say that 70% of all options expire worthless - so the odds are in your favor as a writer (all other things being equal).

In doing my preliminary research the above names pop up all the time (at least on this site), but experienced pro's such as Wayne have little positive to say about them or their methods.

Do you recommend reading material from those three people? What book/s do you recommend? Which options educators are worth their salt? I don't want to waste time and money reading material from people who are not going to inform you properly but rather lead you into other products such as DVDs and seminars. A decent book is probably worth more than a seminar in Fiji for several thousand bucks .

 

[Magdoran]

Hi, everybody !

Recently I've been looking into options after failing to get anywhere trading stocks and futures (main reason is lack of focused time).

I like the idea of writing options for income and so have been looking into that aspect. It appeals greatly because one can set up a write or a short and hopefully not have to focus on it every day until expiry. They say that 70% of all options expire worthless - so the odds are in your favor as a writer (all other things being equal).

In doing my preliminary research the above names pop up all the time (at least on this site), but experienced pro's such as Wayne have little positive to say about them or their methods.

Do you recommend reading material from those three people? What book/s do you recommend? Which options educators are worth their salt? I don't want to waste time and money reading material from people who are not going to inform you properly but rather lead you into other products such as DVDs and seminars. A decent book is probably worth more than a seminar in Fiji for several thousand bucks .

Hello Hopeful,

Have a look through the various threads Wayne, Margaret and I have commented on. You will find consistently the books suggested at the intermediate to advanced level are listed below. For beginners, the consensus seems to be Guy Bower’s book “Options: A complete guide for investors and traders”.

• Sheldon Natenberg "Option Volatility and Pricing"
• Lawrence McMilan “Options as a Strategic Investment”
• Charles Cottle “Coulda Woulda Shoulda”
• Stuart Johnston "Trading Options To Win"

My opinions on Bedford are well known, the other’s I have never read so I can’t comment.

Beware of the concept that the majority of options expire worthless. Many options are traded in complex ways, and many are entered and exited long before expiry, and this simplistic statistic does not take that into account, which is a critical flaw in this ignorant way of thinking.

Also, many options expiring worthless may be part of a complex position like a butterfly, or a credit spread, hence just looking at expiry levels tells you little about who made money out of these positions, or even why they were undertaken. Some people buy puts for protection as an insurance policy, and sell calls to generate income while holding the puts for instance.

So, be very careful about believing that writing options is a risk free cash cow. It isn’t. It can be a great source of income if you know what you are doing, and assess the risk and reward effectively and are able to determine probability sufficiently to profit. But this requires several layers of knowledge – options knowledge (Greeks and strategies), market analysis capabilities, psychological ability, and overall system/strategy.

If you don’t do the due diligence, you can end up broke like one poor fellow a few years ago. He was a public servant in Canberra about to retire, and had written a host of CBA puts naked. Suddenly the market dropped hard, and he was exercised, and had to pay out a six figure settlement. Not pretty! Needless to say, he wasn't able to retire, and had to go on working...

Hope this helps, Hopeful, I’d hate to see you eaten by the market.


Regards


Magdoran

 

[Realist]

For a trading book I was particularly impressed with Richard Farleigh's "Taming the Lion".

 

[swingstar]

Dimitri, unlike the others (afaik), lets people see his trading record. A friend is a member of his diary, and he says he clears on average $50k a month just from writing puts. Of course it's not hard in a bull market, so would be interesting to know how he went recently or will go if the market continues down. He relies a lot on win rate not profit to risk ratio, which is scary if you ask me - a day like 9/11 would totally wipe out his exposure (which could be many months or years worth of profits), so unless you're as cashed up as he is or not diversified then you would face financial ruin.

I don't know much about Jamie, but from other forums I haven't heard any negative reports about his seminars etc. I think he focuses on more than just stocks tho.

Don't know anything about Bedford...

I think these people thrive on people's laziness. You might get something out of them, but if you can put the effort into reading and self-study (which you'll probably end up having to do anyway) then books are the way to go, and they're a lot cheaper too.

 

[Realist]

After reading a little bit about Louise Bedford I am quite sure that she makes her money by showing other people how NOT to make money.

In other words, she can not earn enough as a trader, she recognises this fact, and knows to make money as a trader she needs to write books and train others. People that can do, others that can't teach.

It is a pyramid scheme when you think about it. The first person knows they can't make enough themselves, so they get people under them doing the exact same work and profit off them instead.

I'd love to attend one of these things just for curiosity though, although I think they'd kick me out after the tenth time I ask "what about tax, what about brokerage, what about fees, what about a dip stopping you out of a winning trade?"

 

[CanOz]

Realist, your not a trader so don't cloud somebodies judgement with your anti technical opinions. Let the experienced traders on the forum reply with experienced advice.

Also, has it ever occurred to you that some traders genuinely want to teach others their profession, so they turn to writing books or newsletters. Some people just love to be able to help other people learn and share something that they love to do. I doubt very much if Louise Bedford, or Nick Radge need to rely on their earnings from publishing, that’s crazy.

Sometimes you reply without consideration for others, especially new people to the forum.

Cheers,

 

[NettAssets]

Jamie has a Seminar on share and option trading in Perth 16th - 18th Sept
It is free for past members of 21CA. don't know the price for others.
I haven't seen the Itinery but I would assume Andrew Dimitry will be there along with CFD providers and brokers. will post the list when I get it if anyone is interested.

Hi Realist
I think you make too big an issue out of Tax.
If you are paying tax you are making a profit - You cannot make a loss by paying tax if you are doing your bookwork properly.

John

 

[Realist]

Realist, your not a trader so don't cloud somebodies judgement with your anti technical opinions. Let the experienced traders on the forum reply with experienced advice.

Also, has it ever occurred to you that some traders genuinely want to teach others their profession, so they turn to writing books or newsletters. Some people just love to be able to help other people learn and share something that they love to do. I doubt very much if Louise Bedford, or Nick Radge need to rely on their earnings from publishing, that’s crazy.

Sometimes you reply without consideration for others, especially new people to the forum.

Cheers,

Everyone else here seems to believe in charting. Why not give a different point of view?

Or are you saying that charting is the right and only way and I am wrong?

Chartists themselves like Darryl Guppy admit 90% of newbie chartists lose money - I am doing them a service if anything!!

I also find it hard to believe Lousie Bedford makes a great living off trading, and runs courses and writes books merely to give back to the community.

 

[Realist]

Hi Realist
I think you make too big an issue out of Tax.
If you are paying tax you are making a profit - You cannot make a loss by paying tax if you are doing your bookwork properly.

John

I do make a huge issue out of tax. Agreed. And here's why....

Tax is the biggest problem a trader faces, infact it is the biggest problem an employee or an employer faces. It is the biggest problem a property investor faces. It is the biggest financial problem everyone who earns money faces!!!

Forget petrol prices, banana prices, or share prices. Someone who earns $100,000 a year pays half of that in TAXES.

50,000 a year!!! GONE to the government!!!

Now before you say hang on the tax rate is such and such, add in GST on everything you buy!! Add in the taxes on alcohol, petrol, cigarettes, gambling, stamp duties, then add in capital gains taxes, rates, property taxes, stamp duties on cars and houses, parking meters, speeding tickets and other ways the government slyly takes money off you. They are all taxes in one form or another.

Infact it is maybe 60% of your income.

If you can avoid tax you are sooooo much better off than someone who doesn't.

The recent property boom was fueled by people negative gearing - it comes back to TAXES!!! They invested in property for tax reasons!!


If you buy and hold shares and let your investment compound you are not paying tax at all.

If you trade regularly you are paying 50% tax each year. You're up agaisnt it from the start.

 

[CanOz]

There no doubt in my mind that these people once they proved themselves as traders, would find it much easier to make a living off of training as opposed to trading. Surely it would be less stressful.

 

[Realist]

There no doubt in my mind that these people once they proved themselves as traders, would find it much easier to make a living off of training as opposed to trading. Surely it would be less stressful.

Is trading stressfull??

Not really, if I could trade fulltime and make a mint I'd do it, I think it is quite fun.

Stressfull is turning up to a job you don't like everyday, spending 2 hours a day in traffic, working for 8 or 9 hours a day, 5 days a week, 48 weeks a year, 45 years of your life.

 

[swingstar]

Chartists themselves like Darryl Guppy admit 90% of newbie chartists lose money - I am doing them a service if anything!!

Even though I have never seen any evidence behind that 90% claim, new businesses have nearly as high a failure rate. So with your logic, you would be doing a service by talking every prospective small business owner out of their plans.

Trading isn't all about charting either. Dimitri uses fundamentals only.

If you can avoid tax you are sooooo much better off than someone who doesn't.

In regards to money / lump sum, you're probably right (although your only argument seems to be Buffet). However with regards to lifestyle, then not on your life. I have a great lifestyle. It's been trying at times, but I haven't looked back since leaving my job over a year ago.

Regardless, there are many ways to minimize tax. Look at your friend Farleigh for instance. He gained citizenship in a non-tax paying country.

Stressfull is turning up to a job you don't like everyday, spending 2 hours a day in traffic, working for 8 or 9 hours a day, 5 days a week, 48 weeks a year, 45 years of your life.

Thanks for reminding me why I left.

 

[CanOz]

Is trading stressfull??

Not really, if I could trade fulltime and make a mint I'd do it, I think it is quite fun.

Stressfull is turning up to a job you don't like everyday, spending 2 hours a day in traffic, working for 8 or 9 hours a day, 5 days a week, 48 weeks a year, 45 years of your life.

People feel stress differently. What if L.Bedford loves trading, and teaching. Now she can do both profitably and do this enourmous service to the community! What a life!

 

[Realist]

So with your logic, you would be doing a service by talking every prospective small business owner out of their plans.

YES, I would at least warn them to be carefull.

It's been trying at times, but I haven't looked back since leaving my job over a year ago.

Wait till the bull run ends..... There seems to be alot of sharemarket experts these days, just like there were alot of property investors in Sydney 4 years ago...

Regardless, there are many ways to minimize tax. Look at your friend Farleigh for instance. He gained citizenship in a non-tax paying country.

As I said he is a smart guy.... Smarter than your Guppy's and Bedford's that's for sure..

What other ways are there apart from leaving to go overseas?

 

[swingstar]

Wait till the bull run ends..... There seems to be alot of sharemarket experts these days, just like there were alot of property investors in Sydney 4 years ago...

I can't wait for the bull market to end.

 

[Realist]

People feel stress differently. What if L.Bedford loves trading, and teaching. Now she can do both profitably and do this enourmous service to the community! What a life!

Yeah right, so she is giving her enournmous services back to the community by taking $3,000 of your poor average punters and teaching them how to buy highly speculative shares....

 

[Realist]

I can't wait for the bull market to end.

Be carefull what you wish for.

You may not make money by shorting either.

It may just roll along doing sweet f'all for quite a few years.

It wont just go Bull to Bear overnight...or will it?

 

[NettAssets]

Not really, if I could trade fulltime and make a mint I'd do it, I think it is quite fun.

So you have actually sold a share now and completed one trade now have you?

It's alright thinking its fun until you realise your next pair of pants relies on it.
To be sure I don't find it stressful ..... but Fun?

 

[Magdoran]

Someone who earns $100,000 a year pays half of that in TAXES.

50,000 a year!!! GONE to the government!!!

...If you trade regularly you are paying 50% tax each year. You're up agaisnt it from the start.

WARNING!!!

I feel compelled to yet again address this potentially misleading statement which could be construed as giving financial advice. The caveats made in the text are not sufficient to ensure that readers are not mislead.

I recommend that individuals fully research their taxation situation.

The concept that as a trader you must pay 50% of your profits via GST is WRONG. (I’m concerned when I read these kinds of statements that readers can be potentially hurt financially by potentially misleading information being stated, and this particular comment which has been repeated on other threads really demonstrates the “colossal intellect” of the author).

There are alternative ways of dealing with income depending on a whole range of variables including how an individual’s finances are structured.

It is misleading to say that if you earn $100,000 you will have to pay the government 50% of this amount in taxes. There are a whole raft of deductions and rulings that can be legitimately used which individuals should raise with their accountant and advisers.

While it is fun to see clowns at the circus, you don’t want them running your finances.


Yours in concern


Magdoran

 

[Realist]

So you have actually sold a share now and completed one trade now have you?

Not this financial year.

But I have bought shares as "trades" as opposed to investments though, MRE, MTN, CQT, etc...

As you know I hate selling!!