One of the greatest trading performances in history... One of the safest and most consistent ways to make money in the market... It's nice to be constantly right... A popular trading strategy at S&A headquarters...
One of the greatest trading performances in history has reached an almost absurd new level...
In 2010, we introduced our Retirement Trader service with a simple goal in mind: To take an extremely experienced and successful Wall Street trader... and show readers how professionals generate incredibly consistent profits in the stock market. We wanted to share the tools institutions like Goldman Sachs use to make money every single day.
Keep in mind... the key here is "consistent" profits. We're not talking about shooting for the moon. We're not talking about trades that "hit" for 500% or 1,000% gains. We're talking about generating consistent, low-risk profits that produce 15%-20% annual returns.
Rather than going for "the big one," these strategies amount to safely vacuuming up lots of quarters and dollar bills each month.
The Retirement Trader project has been an incredible success... bigger than any of us thought possible...
The skills our readers have acquired have completely changed their views on investing. Nurses... factory workers... teachers... even longtime financial professionals have written to thank us for sharing these skills. Most will never go back to the "old" and "crude" methods they were using to manage their money.
And in many cases, the skills they're learning are changing their lives...
As subscriber Daniel R. tells us...
I have never used options trading before, but after learning about this through your newsletter, I have sold 13 puts and pocketed close to $90,000.
Brian S. writes...
Using this technique for the last 14 months I took a $160,000 portfolio, and now have a value of about $195,000. I appreciate all your insights and the way you have taught me to be a better investor. I am a CPA and a former broker and can safely say you have given me the best advice I have had.
Subscriber Ouzi Z. wrote...
I have been a subscriber to the Retirement Trader for several months now and I have to say, selling puts has been the most profitable strategy I have ever used in my long trading career.
I want to thank Dr. Eifrig for his patient and methodical approach to teaching this skill. He took all the fear of options away and managed to explain his system in plain English and with great accuracy.
Kudos to Dr. Eifrig for making my retirement a much more financially secure adventure.
One of our subscribers even used some of his trading profits to buy a 100-foot yacht...
He wrote: "PS: I really have been making a small killing with selling your puts!!!"
We have pages and pages of positive feedback about Retirement Trader...
I doubt we've received so much positive feedback about any other advisory we publish. But we won't bore you with any more testimonials.
It's clear that the people who have taken the time to learn about Doc's trading strategies are making money... lots of it. And they're mastering one of the safest and most consistent money-making strategies in the market.
As one of the world's largest financial publishers, we share all kinds of ideas and strategies with our readers...
We write about buying individual corporate bonds... natural resource firms... blue-chip stocks... and speculative technology stocks.
When you publish so many ideas to so many people, you're bound to receive your share of negative feedback. We receive lots of "hate mail" about nearly everything we publish. People just love to complain. There are people out there who would complain about taxes if they received a million-dollar inheritance. This aspect of human nature makes our Retirement Trader project so unusual...
You see, Doc has produced a huge amount of educational material for Retirement Trader readers...
He's produced a series of educational videos. He's written a guidebook. He's published dozens of pages of "Q&A" to help people understand these strategies. He has also produced the best track record of any service in our industry. He has closed 123 consecutive trading positions for a profit.
That's not a misprint... that's 123 consecutive positions closed for a profit.
Because of this incredible track record... because of the unique, safe strategies Doc is teaching people, we've received an amazing amount of glowing feedback from readers. We receive almost zero complaints. This unrelenting amount of "love mail" has us baffled. Even the most miserable people can't find an excuse to complain. It's like running a steakhouse for a year... and having no complaints about how the steaks were cooked. It's a business phenomenon that shouldn't happen. But it is...
As we've written many times, we encourage skepticism toward Doc's "123 for 123" track record...
When people make claims of a "perfect" track record, it's almost always misleading. Plus, a "perfect" track record isn't necessary to achieve trading success. What's necessary is to win a lot when you are right... and to lose a little when you are wrong. Because of this fact, many traders have built fortunes with sub-50% win rates. We state again: winning in the market is FAR more dependent on winning a lot when you are right... and losing a little when you are wrong.
But as our readers have learned, it's nice to be constantly right. Especially when being right is the result of learning about one of the most powerful (and most misunderstood) financial tools in the world. That's why we are so adamant that all of our readers at least learn about Doc's strategies...
The strategy Doc uses in Retirement Trader is called 'selling puts'...
A "put" is an option. When someone buys a put option, he's buying the right (but not the obligation) to sell a stock at a set price (called the "strike price") by an agreed-upon date in the future. So when you buy a put, no matter how low a stock's price falls, you can still sell for the strike price.
You can think of a put option as insurance. The buyer of the option is paying a small premium to insure his position against a decline in price. But what most people don't realize is that individual investors can also sell someone that insurance and collect the so-called "option premium."
Most folks find it easier to think in terms of insuring a home...
When you insure your home, you are essentially buying the right to sell your house to the insurance company for a certain value, under certain conditions, for a limited period of time. In return, you pay the insurance company to accept those terms – whether or not you ever exercise the terms of the policy.
Put options work the same way. When you sell a put option, you're acting like the insurance company. You're agreeing to buy someone else's shares of a particular stock for a set price, under certain conditions, for a limited period of time.
In the case of your house, you'd exercise your policy in a disaster... when a fire or catastrophic weather damage wrecks the value of your home. In the case of a put option, the holder would exercise his right to sell us his stock if the market value of his shares falls below the price we agreed to pay.
When you sell a put option, the trade works one of two ways...
You either collect the entire premium without any obligation... or you end up buying shares at a discount. Considering the latter outcome, it's important to only sell puts on companies you want to own.
As an example, let's walk through an actual trade Doc recommended in Retirement Trader...
On January 4, 2013, Doc sold March $20 puts on Cisco. At the time, shares of Cisco were trading for $20.45.
In this example, $20 is the strike price. As long as shares of Cisco traded for more than $20 by the expiration date (in this case, March 16, 2013)... subscribers who followed Doc's recommendation would book the entire premium with no obligation to buy shares. (After all, why would the buyer of that put exercise his option and sell shares for less than he could get in the open market?)
When Doc made his recommendation, the option premium for selling those puts on Cisco was $0.65... An option contract covers 100 shares, so readers following his recommendation immediately collected $65 for every contract they sold.
On March 16, 2013, the Cisco options 'expired worthless'...
Shares of Cisco were trading at $21.60 on the day the options expired – well above the $20 strike price. And Retirement Trader readers kept the entire premium for a 16.3% return on margin.
That word 'margin' is important...
When you sell put options, your brokerage requires you to set aside 20% of your potential obligation. Using the Cisco example... If we sold one option contract, we're responsible for 100 shares at $20 per share (or $2,000). In this case, we'd deposit $400 (20% of $2,000).
Because we collected $65 in premiums and only had to deposit $400, we made 16.3% on the trade in about two months... That's an 87% annualized return.
This is just one trade...
Remember, Doc has closed 123 consecutive positions for a profit. And that track record hasn't only made him popular with our readers... Many of us at S&A headquarters have embraced Doc's strategy.
I (Sean Goldsmith) personally use this strategy to make a few extra thousand dollars each month. And S&A Editor in Chief Brian Hunt has made a small fortune selling puts – it's his favorite trading strategy.
Even Porter sells puts... In fact, Doc's knowledge in this area of the market was one of the main reasons Porter hired him.
We've written lots about Doc and his Retirement Trader strategy over the years... So we won't repeat everything today...
We are dedicating our weekend Digest Masters Series to Retirement Trader... We've chosen some timeless essays that better explain Doc's strategies... and one of the most important rules of selling puts – you only sell puts on great companies when they are trading at bargain prices.
New 52-week highs (as of 7/3/13): 1st United Bancorp (FUBC) and ProShares Ultra KBW Regional Banking (KRU).
Hopefully we'll start getting some feedback on Doc Eifrig's Retirement Trader... Until then, our inbox is full of rave reviews for James Altucher's book, Choose Yourself. Send your e-mails to feedback@stansberryresearch.com.
"I read James' great book Choose Yourself over two days. What he's fighting there is inertia, the hardest thing for a reader to overcome. I just lost my electricity for 22 hours because of snapped power poles from a micro-burst which led me to understand how much time I had been wasting on TV and the Internet. Knowing how much time we are already wasting is another punch in inertia's gut, so if you can't find time to do things he suggests, get off the grid for a day. Come up with ideas to fight inertia then ideas for doing other new things then do 'em." – Paid-up subscriber Brant Gaede
"Great book, thanks for the recommendation!! I think it will help to finally get me off my duff and take control of my life as we head into our government induced crisis yet another time. Thank you once again!!!" – Paid-up subscriber A.T.
"I am about 120 pages into the 160 page Choose Yourself PDF. Knowing that a hardcopy will arrive to become part of my permanent library is a great feeling. Thanks much for pressing your enthusiasm enough to get me to buy.
"Life has a way of always proving the future is not what you project, but what happens. I expect that I will remain engaged as James is, but free in the sense that no one can dictate my future or take away my enthusiasm and wonder for life. Living well below one's means, avoiding negativity and gossip, and becoming as healthy as possible is a recipe for happiness... and being prepared to weather the many storms life will bring, Those storms are the basis for some of our best learning and greatest strength." – Anonymous
Goldsmith comment: It's clear from the loads of feedback we've received, you're all enjoying Altucher's books. (Well, almost everyone.) If you haven't ordered a copy yet, you should do so soon. We're on pace to sell out soon... Learn how to get your copy by clicking here...
Regards,
Sean Goldsmith
Miami Beach, Florida
July 5, 2013