wayneL
VIVA LA LIBERTAD, CARAJO!
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...or anything, for that matter.
Broadly, there are 4 stages people move through as they learn about something, in this case because it is in the derivatives forum, options.
1/ Unconscious Incompetent
2/ Conscious Incompetent
3/ Conscious Competent
4/ Unconscious Competent
1/ Unconscious Incompetent
This is the stage where you don't know anything. You don't even know what you don't know. Propbably most people who attempt to trade options never actually get out of this stage before quitting, having had their @rse handed to them on a platter.
Amazingly, there are a lot of options courses out there that don't take their students anywhere past this stage. In fact, I know of several that actively DIScourage folks from further learning, with the catchcry of KISS. To avoid the possibility of spending the next several years as a litigant, said educators shall remain nameless
2/ Conscious Incompetent
This is the stage where you realise you know nothing, and if you have any capital left you go about the process of learning. (you can always try to get a refund from J..... oops better not say )
This is a difficult stage to be in, because all option educators claim to be exclusive purveyors of truth and option enlightenment, and because you are still an incompetent, you are not able to discern the truth from the NLP laden marketing.
A great start is to read the several tomes that are almost universally recommended by long term survivors of option trading.
From novice to advanced;
Options by Guy Bower
Options as a Strategic Investment by Larry McMillan
Options Volatility and Pricing by Sheldon Natenburg
These are all available from Joe's bookshop
In addition, I like
Trading Options to Win by SA Johnston (available from Joe)
Options: The Hidden Reality by Charles Cottle (available from www.riskdoctor.com)
There are a couple of good courses around as well, but the absolutey best one is still in development
3/ Conscious Competent
The transition to this stage is gradual and a grey area. Competency will arrive, but you will still be thinking about all the factors conciously, and you may still be incompetent in certain areas where you will have to refer back to your books, course materials and/or mentor.
I think the transition from stage 2 to stage three is; and is best viewed as as an oscillation process. You will find yourself clear on one concept, and fuzzy on another. Clarification on a new concept, could make you fuzzy on something you thought you were clear on.
You are not dumb! This is normal! If you immerse yourself in it, get comfortable with the lingo, talk the lingo at every opportunity eventually you will get competent. At this point you will be well on the way to being the....
4/ Unconscious Competent
This is the point where most things are second nature. If someone is speaking "greek" you will understand without having to think about it. There are always areas where you have to revert back to the "concious" stage, particularly if something is outside of your normal approach or style, or even a different instrument. (eg index options skew to the downside whereas many commodity options skew to the upside.
But generally you act without having to think to hard. This can only come with time and lots of trading... and of course survival.
Hope it helps.
Broadly, there are 4 stages people move through as they learn about something, in this case because it is in the derivatives forum, options.
1/ Unconscious Incompetent
2/ Conscious Incompetent
3/ Conscious Competent
4/ Unconscious Competent
1/ Unconscious Incompetent
This is the stage where you don't know anything. You don't even know what you don't know. Propbably most people who attempt to trade options never actually get out of this stage before quitting, having had their @rse handed to them on a platter.
Amazingly, there are a lot of options courses out there that don't take their students anywhere past this stage. In fact, I know of several that actively DIScourage folks from further learning, with the catchcry of KISS. To avoid the possibility of spending the next several years as a litigant, said educators shall remain nameless
2/ Conscious Incompetent
This is the stage where you realise you know nothing, and if you have any capital left you go about the process of learning. (you can always try to get a refund from J..... oops better not say
)This is a difficult stage to be in, because all option educators claim to be exclusive purveyors of truth and option enlightenment, and because you are still an incompetent, you are not able to discern the truth from the NLP laden marketing.
A great start is to read the several tomes that are almost universally recommended by long term survivors of option trading.
From novice to advanced;
Options by Guy Bower
Options as a Strategic Investment by Larry McMillan
Options Volatility and Pricing by Sheldon Natenburg
These are all available from Joe's bookshop
In addition, I like
Trading Options to Win by SA Johnston (available from Joe)
Options: The Hidden Reality by Charles Cottle (available from www.riskdoctor.com)
There are a couple of good courses around as well, but the absolutey best one is still in development
3/ Conscious Competent
The transition to this stage is gradual and a grey area. Competency will arrive, but you will still be thinking about all the factors conciously, and you may still be incompetent in certain areas where you will have to refer back to your books, course materials and/or mentor.
I think the transition from stage 2 to stage three is; and is best viewed as as an oscillation process. You will find yourself clear on one concept, and fuzzy on another. Clarification on a new concept, could make you fuzzy on something you thought you were clear on.
You are not dumb! This is normal! If you immerse yourself in it, get comfortable with the lingo, talk the lingo at every opportunity eventually you will get competent. At this point you will be well on the way to being the....
4/ Unconscious Competent
This is the point where most things are second nature. If someone is speaking "greek" you will understand without having to think about it. There are always areas where you have to revert back to the "concious" stage, particularly if something is outside of your normal approach or style, or even a different instrument. (eg index options skew to the downside whereas many commodity options skew to the upside.
But generally you act without having to think to hard. This can only come with time and lots of trading... and of course survival.
Hope it helps.
