50X Your Money With These Cheap Option Trading Strategies

hey what's going on guys it's henry back with another video and in this video i'm going to be talking about small account strategies i know so many people out there are trying to grow their small portfolios and today i'm going to be talking about some strategies that can turn 70 into 430 or even 700 into 4 300 so yes going to basically talk about how to 6x your money with a small portfolio i'm going to be discussing three different strategies that i want to share with you today and i think you're going to really like what i have for you also make sure to check out the free email newsletter that i have in the description i usually give free weekly value over there and it also doesn't hurt to hit that like button and subscribe now something important i'm going to discuss is closing positions because a lot of students have asked me about closing positions when to do it so we're also going to discuss setting stop losses it's very important to risk management and it's also very important if you want to be a profitable trader so people think that you need a large portfolio to make a lot of money and i want to debunk that myth because it's actually just not true you can actually turn a smaller portfolio into a medium and a larger portfolio it just takes skill knowledge taking proper risk managing your losses and of course risk management and the combination of these things will allow you to grow a small portfolio because it's not like you have to have a seven-figure portfolio like me to see some good returns i'm gonna be showing you a few different trades on three different stocks that i think is a very good trade and in fact i would place that trade if the market weren't closed right now but as soon as the market opens up i'm actually going to be making these plays all right so the first thing i want to show you guys is i'm going to open up aal and the reason why i want to open up american airlines is because the strategies that i'm going to be using today well one of the assumptions is that the stocks are not going to tremendously shoot up or fall basically our assumption is that a stock is going to continue to go sideways in fact all three strategies that i have today is going to consider that a stock is going to go sideways because part of that reason is i think the market is high but i also don't see any catalyst for it to fall any lower so i think the market will trend sideways but anyways you can pick your own stocks this is just me showing you what i'm going to be doing and my thought process you don't have to copy this by no means am i a financial advisor just go ahead and learn everything that you can and then apply this knowledge to your own stocks and your own watch list so taking a look at american airlines it has had some volatility however what i've noticed is as soon as it jumps up it always tends to fall back down in fact if i go to six month chart it pretty much hasn't gone anywhere in the past six months i mean sure it did start off around 25 but if you take a look right over here i'm gonna scroll down right now around july 19th this stock is still trading where it's been on july 19th so for the past four months this stock has gone up down up down it's pretty much treaded sideways gone up and then back down up and then back down and i kind of understand that this pattern is going to continue with the american airlines i don't see any reason that it's going to fall too much lower i don't see any reason why it's going to jump back up in the next couple of days so for this week i'm going to show you a strategy that is basically going to turn about 70 into 430 and open up that position in robinhood but real quick as you guys can see every time it jumps back up it trends down and then it'll go sideways for pretty much a week so this is about a week this is about a couple week period right here this is from the 16th and this is going back to the 16th so this is an entire month where american airlines has traded sideways essentially that is a thesis for american airlines that's where i'm going to be starting here i'm going to go to trade american airlines options aal options now you can pick any date that you really want i typically like to go for weekly options or bi-weekly options the reason why i like to go for weekly options is because not a whole lot of stuff can happen in a given week i mean unless there's an event like maybe earnings or there's a fed meeting then there's usually not a whole lot of events that can turn an option upside down and if the option doesn't go in my favor i can always set a stop loss i can always close the position and it's much easier to monitor a position in a given week then have a option that is out for a month or three months that longer term time period is just harder to trade because it's easier to bet on a stock going sideways in a given week than for a stock to go sideways in a whole month or a whole three month period so now i'm going to look at the option chain and again as an option trader my assumption here is that the stock will move sideways so the first thing that i'm going to do is i'm going to sell a call option that is near the money so right now american airlines is 19.53 i'm going to sell the 19.5 strike and that's basically at the money it's only three cents off so i'm gonna click right here it's going to be worth 30 and i'm going to click sell this is going to be 30 bucks and now what i'm going to do this is very important i'm going to go buy a call option you guys will see i'm going to enter a custom order so this option strategy is going to be a custom order and you're going to see on the right side right over here the exact payoff the risk that i'm taking in the profit that i'm going after okay going for buy call option i'm going to buy a leg above and a leg below this is going to be important when you guys see this strategy actually play out getting started here 19 strike this is the leg below the 19 and a half that we have open so i'm going to open up this call option right here this is going to be a buy now i'm also going to buy the 20 call option right here now if you notice the cost is 42 but what i'm going to do is right here we see this custom order there's a little drop down menu here and i'm going to go to custom rather than a one to one ratio i actually don't want to open up one one one i'm actually going to go ahead and sell it to 19.5 going to the custom clicking right here going right here where it says 19.5 the option that i have sold i basically want two of these sell orders to account for this one and one buy order all right cool now that we have entered that i'm going to scroll down and you guys can see that this is a very beautiful chart and i'm going to explain it right now the max loss right here is 12 however your max profit is 38 dollars so as you guys can see in this example right here you can triple your money you can actually bet 12 that is your total max loss you can't lose any more than that and the total max profit is 38. now again the assumption here is that american airlines stays right around the center point where it's currently at right now so at this point right here in the middle is going to be a max profit of 38 and you're only going to start to lose money if american airlines goes past 19.88 cents or if it goes below this point right here which is 19 dollars and 12 cents so as long as american airlines stays within this range which again is considering that the stock is going to move sideways you're going to be able to collect that full 38 dollars at this very peak and you're going to collect different varying amounts right here but obviously but obviously it's still very easy to double your money even at this point right here or this point as long as you stay within this green area you're gonna see a profit around this area you're gonna see a double and at the very peak you're going to see a triple on your money now this is a strategy that is fantastic for growing a small portfolio on a stock that isn't going to move very much i probably wouldn't do this strategy on something like a tesla where the stock is moving tremendously up and down i would do this on a stock that is not moving very much because you're going to have a much better chance at making a profit i also like this a lot because what i teach my students is basically weekly income strategies where we're collecting one to maybe five percent on the higher end per week this is a good strategy for some of the people that want to aggressively grow their portfolios maybe one to five percent a week isn't enough for them so they want to go for something that is maybe riskier or has greater leverage this is a strategy where you can actually double and triple your money so some of the people with smaller accounts are going to want to incorporate this strategy into their toolkit all right guys so real quick what i want to show you is this other trade on american airlines that i found that can turn one dollar into a maximum profit of 49 so basically you can 49 x your money or basically 50 extra money going from 100 to 5 000 on this single trade right here and the reason why i want to show it to you was because i forget where i was looking at that trade from 700 to 4 300 i don't remember what i was looking at but i found a better opportunity that i want to share with you now what i did here was the very exact same trade except i went for december 3rd again i went for the same trade that i just showed you guys but i bought the 18 and a half call i bought the 19 and a half call and i sold two 19 call options now the total cost for this trade is one dollar you can get started with just one dollar here on this trade and essentially as long as american airlines stays within this range from 18 and 50 cents up to 19.48 cents or right around where it's at right now or right around the current price then you're going to make somewhere up to 49 depending on where the stock actually ends up trading and again the maximum amount you can lose here is one dollar so there's very little risk here and a very huge reward on this trade now the next stock i want to talk about is palantir technologies this is a stock that when you look at the chart it has been going sideways for a very long time and recently it has fallen down quite a bit now regardless of the reason why has fallen down usually this stock will move up or down very similar to american airlines which is why i picked this stock as a second strategy that i want to show you guys because once the stock goes up it'll come down it'll consolidate it goes up again goes down consolidate goes up goes down and consolidates so this is basically the perfect time where i see another strategy that an investor or an option trader can play for a stock moving sideways really benefiting in cashing in on a stock not doing too much in the near future so in a given week i can see palantir continuing to move sideways because the pattern right here is moving up down sideways up down sideways and then again up down and now i expect the stock to go sideways because once investors come into a stock and then they crash the stock by taking a lot of profit at that point if there's no catalyst there's no reason for the stock to move up or down again so usually it trends sideways before there's another big catalyst or some news event or earnings or some announcement that is going to move the stock so for this given week or even the next couple of weeks i expect the stock to move sideways because from this period of july 13th to about august 13th it was basically a whole month where the stock just moved sideways i mean it's not a full month but it's about 28 or so days from this period of october 4th to about october 15th again a two-week period sure the stock moved up but it actually just moved up from 23 to 24 so that is basically a sideways move and now since the stock is around 21.41 i'm going to come into my robinhood platform right here again i'm going to go trade pltr options now this strategy is going to be somewhat similar but i'm going to show you guys the slight difference and exactly how much money you can make here trading valencia options in a given week using another sideways option strategy which requires almost no money i mean i'm going to show you guys how much money it's going to require first of all i'm going to go sell a call option now this is going to be very similar because i'm going to sell an at the money call option selling this one right here the 21.5 and again i'm going to do the same thing that i did before and you guys will see the difference in just a second i'm going to go buy call option okay now i'm going to move for the leg lower right under 21 and a half okay so this is the current leg that i have open 21 and a half and now i'm going to buy the leg under the 21 okay so i'm gonna click here bought this for 75 and now i'm actually going to go back to the 21.5 and buy the leg above it so the leg at the 22 strike price now i'm going to click buy right here and that is going to complete this trade however now i just have to adjust the custom order so again i'm going to click this little drop down menu right here i'm going to go to custom order and now for the option that i sold i'm actually going to go right here and enter three so rather than going for two i'm going to enter three that makes this payoff a little bit wonky but what i'm going to do now is i'm actually going to sell two of the highest strike call options so rather than having one i'm going to click two right here and now you guys will see right here that as long as this option stays within the certain range that you're still going to have a massive benefit now here this is another strategy that considers the stock moving sideways however now if the stock has a tremendous rise then you are going to lose some money however again taking a look the max loss is 39 but the maximum profit is 61 so you can almost double your money in this trade and again the reason why i'm going for this type of trade on pounds here is we go back to the chart right now this stock has had a tremendous pullback and now it continues to fall so we've had one big pullback where we had a major sell-off we had a little bit of a bounce back however that bounce back was not sustained and now the stock is continuing to fall and then it had another small red day actually if i go to the one month chart instead here going to be easier to see this stock has now gone down on a one single trading day of basically nine cents so i can see the stock continuing to fall down just a little bit but again have your own assumptions don't just copy what i'm telling you right now go pick a stock have your own assumptions and if your assumptions fit this description then go ahead and run this type of strategy where you expect the stock to potentially slightly pull back but basically expect it to trend sideways and stay within a certain range this strategy is going to be phenomenal now it doesn't have as much return as a strategy that we just had before however again turning thirty nine dollars into sixty one dollars is going to be greater than a fifty percent return or right around that fifty percent return mark in a single week so obviously someone can put up three thousand nine hundred dollars and turn it into six thousand one hundred dollars if the stock were to end around 21.50 all right so the third strategy and what i want to show you is going to involve neo stock so if i pull up the neo chart right now on my screen we know that money is a stock that i've been following for a very long time and this stock has frustrated investors however it has honestly not really frustrated me as someone who's just a stock investor hoping that neo is going to go to the moon it has been a very difficult journey however for option traders who are selling put options who are selling covered calls and who are just running different option strategies that i teach my students we have basically had a blast with a stock because even though it has gone nowhere except for basically up down up down up down that's actually a fantastic thing for option traders because option traders love volatility and also option traders can take advantage of a stock not going anywhere and still make a ton of money whereas stockholders cannot really do that so now taking a look neo is currently sitting right around the moving average that it has been at for the past 60 days yes the stock has been lower the stock has been higher however it's currently at the moving average and i expect the stock to continue moving sideways until we see some really good numbers or some good deliveries and that's not going to happen until early december we're not going to know how many deliveries neil had in november until december hits so for this week as an example or if you're watching this in the future if there's no catalyst there's no earnings or there's no deliveries for an ev company then again you can run a strategy that benefits from a stock going nowhere or really going sideways so what i'm going to do right now is i'm going to trade neo options very similar to what i've been doing now i'm going to start off with selling put again i'm going to have the expiration date for november 26th pick your expiration date that you want to go for again i recommend going for weekly you can go for bi-weekly whatever date you're watching in the future pick the expiration date that works best for you now what i'm going to do is i'm going to sell a put option at the closest to the money but slightly under than the current share price so right now neo is currently trading at 40 and 24 cents i'm going to sell the 40 strike now i'm going to cover this up by buying the next leg lower so i'm going to buy the 39 strike right now and there we go we have opened up a put credit spread however now what i'm going to do is i'm going to continue opening up two more legs now the only thing i did right here on the top is i'm going to sell a call option the call option that i'm going to sell is going to be nearest to the money however a little bit out of the money so rather than going down to 40 selling the 40 and buying the 39 now i'm going to sell the 41 and i'm going to buy the 42. this is going to open up a short iron condor position you can actually see here unlike the other two strategies where we had to spend just a little bit of money and we could have turned a small sum into you know 50 gain or a double or a triple on your money here you're actually going to collect a credit you're actually going to get paid if i scroll down on the chart right here again you can see right here that the stock has to trade within a certain range so as long as neo stays within 39 dollars and 18 cents and 41.82 cents you are going to collect a profit in this area now your max loss is 18 and your max profit is 82 so in this scenario you can basically forex or even a little bit more than 4x your money on this single trade as long as neo stays around this top area right here so for me this is one of my favorite strategies this is what i teach a lot of my students because i love collecting a credit to begin with rather than paying money up front i'd rather collect some money coming in this strategy is a little bit more advanced however you can turn 180 into 820 if you enjoy strategies like this or if you want to follow my trades and see how i'm trading live every single week then you can join the private discord community it also does come with a course on learning exactly how to trade options so if you want to learn a real skill that makes money and get results then i'd recommend you submit an application to work with myself and my team and make sure to check out more of my option trading videos

Channel: Invest with Henry

Views: 1,391,540

Keywords: option trading, options trading, options, stocks, invest with henry, robinhood options

Id: 68aqHoMRShs

Length: 16min 29sec (989 seconds)

Published: Mon Nov 22 2021