Editor's note: Our friend and colleague Dr. David Eifrig is so excited, he's doing something for the first time in five years...

He's publishing another newsletter.

But unlike Retirement Millionaire, which seeks high-quality investments to protect your nest egg... Income Intelligence, which generates a steady stream of cash for income investors... or Retirement Trader, which uses options to grow your retirement accounts... this brand-new product is unlike anything he has ever published before.

In this weekend's Masters Series, we're featuring an exclusive interview with Doc's right-hand man, Matt Weinschenk. In the first installment, he discusses the strategies they'll be using to "boost" your gains in the market...

Doc Eifrig's Two Brand-New Ways to 'Boost' Your Returns

An interview with Matt Weinschenk, senior analyst, Retirement Trader

Sam Latter: I'm here today with Matt Weinschenk, senior analyst for Dr. David Eifrig's Retirement Trader newsletter.

Matt, you and Dr. David "Doc" Eifrig have been hard at work over the past few months developing a new trading strategy. Can you tell us a little about it?

Matt Weinschenk: Sure. We're calling it Advanced Options.

We'll be trading options in a more involved way than what we've done in Retirement Trader. It comes with a small learning curve. But it's worth it, because people who are willing to sit down and figure this out will unlock a pair of really powerful and profitable trading techniques.

We began "paper trading" these techniques a year ago in live markets and distributing it internally around the office to get some feedback on the product. But our results were so phenomenal, we knew it was time to share it with Stansberry Research readers. Of the 31 trades we made, 68% of them closed for a profit, with average returns of 23%. But it's important to note that we're only in these trades for a few weeks at a time.

We've found it to be an exciting, fun, and lucrative way to speculate in the markets.

Sam: We have concrete evidence that the word "options" is enough to turn some readers away. Folks seem to lose interest or feel overwhelmed with the idea of trading options.

But your team's results in Retirement Trader suggest that options can be a safe and profitable way to trade in the markets.

Matt: Absolutely. We began publishing Retirement Trader in 2010. Over that time, we've closed 434 winners out of 458 total positions. That's good for a 94.8% win rate. At one point, we had even strung together 136 consecutive winning trades.

If people don't want to take the time to learn options, that's up to them. It doesn't take long to understand how the mechanics of these trades work. And both Retirement Trader and Advanced Options are fun ways to make money doing something most people don't know how to do. It seems a little foreign at first, but once you get rolling, it's really not complicated.

We've been doing this for years, so to us, it's second nature at this point. We think everybody should be trading options to make some extra money. The payoff is certainly worth it.

Sam: I think one of the main hesitations investors have is that most of them don't know how to properly trade options, so they end up losing money and getting discouraged. How has Retirement Trader managed to compile an eight-year-long track record that has made money almost 95% of the time on its trades?

Matt: When people begin to learn options, the first trade they think to make is usually the wrong one. And in Retirement Trader, we have a high win rate because we do the opposite. Most people buy options to speculate. In Retirement Trader, we sell options for income. And we do it in a way that covers the risks that trading options sometimes creates.

We don't swing for the fences. We have a great "batting average" because we hit singles and doubles again and again.

Advanced Options does something similar. It's a trade using two options together, which is called a "spread." By doing this, we avoid a lot of the challenges that crop up when you try to make a simple options trade. But let me be clear: This is different than what we do in Retirement Trader. This is more speculative, and it's intended to generate bigger returns.

Sam: It's hard enough to pick a stock that you think is going higher. With options, not only do you need a stock to rise a specific amount, but you also need that to happen by a specific date. You can actually be right and still lose money trading options.

Matt: Exactly. If you just buy an option, different factors are working against you. As time goes by, options lose their value. So you might say, "Hey, I'm going to buy this option. I think the stock is going to go up." Then you watch the stock go up and everything plays out how you wanted. But when you look at your return, you've lost money. That's because when you buy an option, you're also working against time and volatility.

Sam: But the strategy you're using in Advanced Options takes some of that downside risk out of the equation. Can you tell us about these two types of trades?

Matt: Sure. The first trade is called a "bull spread." This is a speculative bet that a stock will go up – hence why there's "bull" in the name. The first thing you want to do is find a stock you think is heading higher. Then we'll place a trade that will profit if we're right.

Here's an example... Let's say we buy one call option on soda giant Coca-Cola (KO) with a $50 strike price and sell another call option on Coke with the same expiration date and a $55 strike price.

The call we buy gives us the right to buy shares at $50. The call we sell obligates us to sell shares at $55. If the stock goes up to, say, $60, we buy shares for $50 and immediately sell them for $55. Our bull spread will be worth $5, but it would only cost us something like $1.50. We've made a $3.50-per-share profit, or $350 per contract we trade.

Basically, we're betting that the stock will go up, and we profit from the difference – or spread – between the two strike prices. The strategy still involves betting on a stock to move higher, but it eliminates both time decay and volatility from the equation, which are two of the biggest hurdles that new options traders face.

Plus, because we're collecting some money for selling an option, it lowers our out-of-pocket expenses on the other option we're buying. Think about it like this... If we buy an option that costs $3, but sell an option that pays us $1, we've reduced our maximum risk from $3 to $2. If we're right and the trade goes in our favor, our returns will be even bigger on a percentage basis, because we've put in less capital up front to make the trade.

Sam: That's a good overview of the bull spread strategy. But that's just one of the two types of trades you guys are putting on in Advanced Options. The other is called a "calendar spread." What can you tell us about that?

Matt: Calendar spreads are interesting.

You can make money on these without the stock moving higher or lower. The way these work is because "time value" – the cost of an option (the premium you pay for buying it) minus its "intrinsic value" (the difference between the option's strike price and the price of the underlying stock) – runs away on options... And it runs away on short-term options faster than on long-term options.

So with calendar spreads, we're buying a longer-term option and selling a shorter-term option, and we profit from the difference. Unlike the bull spread – where we picked calls with two different strike prices – on the calendar spread, we stay at the same strike price but pick options with different expiration dates.

Again, let's use Coca-Cola as an example. Let's say we think Coke is going to stay around $50 for a while. We would sell a $50 call that expires in one month and buy a $50 call that expires in three months. If Coca-Cola is still trading around $50 in one month, that first option is going to be worth basically zero. And because we've sold that call, all of that is profit.

Now, the other option we've bought is going to go down in value, too. But it's not going to go down as much, because the time value runs off slower on longer-term options. So we know one option is going to zero and the other won't go down as much, and we profit from the difference.

The key here is that we're betting Coca-Cola will stay around the same price. If it goes up or down a little bit, we're OK. But we want it to trade within a certain range, and as long as it does, we'll make money from the difference in time value.

Sam: So the time value for the shorter-term option is going to run off quicker because fewer things could happen in one month versus three months... For instance, Coca-Cola could announce a new CEO, a dividend increase, a huge share-buyback program, or a blockbuster acquisition which could have a major effect on the share price. That's basically the idea, right?

Matt: Exactly. Options with more time value are always worth more. As time passes, their price goes down. And time value erodes the quickest in the last month before expiration. That's the phenomenon we're taking advantage of with the calendar spread.

Sam: We've covered the basics behind these two strategies. They're definitely in the same universe as far as trading goes, but they each have their advantages. What would you say are the main differences between the two types of trades?

Matt: Again, for the bull spread, you want a stock that's going to go up. And with a calendar spread, you want a stock to essentially trade sideways.

The bull spread is shooting for bigger gains – like 200% or 300%. If you do it right, you're going to hit on them about half the time.

Calendar spreads are going to have smaller gains, somewhere in the 50%-100% range. But they should also have a better win rate than the bull spreads.

Putting those two together gives us two great tools for our trading toolbox. We can bet on stocks going up or going nowhere. We can make huge, triple-digit gains some of the time, or solid gains more frequently. That's why we like both strategies.

Editor's note: After a year of testing their new strategy, Doc's team quickly generated huge returns on everyday stocks and funds... like 90% on semiconductor stocks... 181% on steel stocks... 123% on online-dating company Match Group... and 167% on Disney, to name a few. Learn more about this powerful trading strategy – and how to become a charter member at a deep discount – right here.