paycheck - module 5 - vectorvest1 disclaimer the vectorvest program (“the system”) which...

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Disclaimer

The VectorVest Program (“the System”) which we promote is not intended to provide you with specific or personalized advice. In all circumstances where you are looking to apply the System to your own personal needs you should consider whether you should first seek advice from a suitably qualified investment professional.

Figures and information provided refer to the past and past performance and are not a reliable indicator of future results. Where stocks are quoted in foreign currencies, returns may increase or decrease as a result of currency fluctuations. In the event that you, as a recipient of this presentation, have any doubts as to the suitability of the investments or services promoted you should seek advice from a suitably qualified investment professional.

You should be aware that the value of shares and other stocks may rise or fall. The rules on tax can change, and these changes may have an influence on the effectiveness of the System in the future. It is for you, as the tax payer, to assess the System’s effectiveness throughout the process. Some assets are more readily realizable than others, and you should bear in mind that it may be difficult to deal in or obtain reliable information about their value. You should always take account of dealing charges. In addition to any initial charge quoted there may also be a bid/offer spread or dilution. Investments in options and other forms of derivatives may expose you to a higher degree of risk given market circumstances relative to other forms of quoted investments.

The System even if used in its entirety, cannot be guaranteed to provide specific returns in the short, medium or long term and you should bear in mind that individual securities may and can fluctuate considerably in value from day to day. The System has been designed without any reference to the specific interests of a particular investor. We reiterate, when using the System, you must take into account your own specific needs and liabilities.

This financial promotion has been approved by European Financial Publishing Ltd trading as VectorVest UK which is authorized and regulated by the Financial Services Authority under Register No 543038. European Financial Publishing Limited is a company incorporated in Scotland under Company Number SC357322 with its registered address at Exchange Tower, 19 Canning Street, Edinburgh EH3 8EH.

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Trade Set-Up

Maximizer

➢Module 4 Review

➢4 Key Principles

➢Big Mistake To Avoid

➢Action Items To Take

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Trade Set-Up

Maximizer

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Multiple Graphs To Look At

Don’t Get Paid Enough

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Key Principles

To Get Paid Top $$

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Remember

this from

Module 1?

Use the Over/Under Priced

Indicator as your guide to cheap

vs. expensive Option Premium

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Focus your trading on areas where

Volatility is likely to decline.

When Volatility rises, an expensive

option becomes even more

expensive & can kill your trade!

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Let’s look at 4 Scenarios of Selling a Put

on Tesla to better understand how Price

& Volatility can affect the option price.

This models selling the 180

Put on TSLA on May 10.

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Scenario #1:Stock rises.

Volatility stays flat.

Result:You hit 50% profits in 8 days!

Scenario #2:Stock stays flat

Volatility stays flat.

Result:You hit 50% profits in 15 days.

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Scenario #3:Stock rises.

Volatility rises.

Result:You hit 50% profits but in

16 days!

Scenario #4:Stock stays flat.

Volatility rises.

Result:You hit 50% profits but in

25 days!

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16 days 8 days

25 days 15 days

Stock

Rises

Stock

Flat

Volatility Rises Volatility Flat

Focus your trades to where the

options are the most overpriced

or have the lowest chance to

have an increase in volatility.

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And not here…

Because sometimes

seven days can be the

difference between a

gain and a loss!

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Case Study #1

Date: 4/13

Stock: TSLA

Trade: Bull Put

Volatility: Overpriced BUT…

Options are overpriced but

below the average highs.

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Choose a 235 / 225 Spread

Based on the 30% ITM criteria.

Profit target = $140 per contract

(50% of the $280 credit)

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The most you were ever up was

$38, not enough to take profits.

What if you had waited

until Volatility was closer

to the average highs?

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Case Study #2

Date: 4/22 (9 days later)

Stock: TSLA

Trade: Bull Put

Volatility: Overpriced & near

avg highs

Choose a 237.50 / 227.50 Spread

Based on the 30% ITM criteria.

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Profit target = $207 per contract

(50% of the $414 credit)

Profit hit, a few

days later…

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And seven days later?

Big Loss…

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The recurring theme of the Paycheck

concept is to limit market exposure, because as we saw…

A lot can happen in 7 Days.

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VV Search

Matrix

The Matrix is a powerful option scanner that c

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Starting with the UniSearch we scan

for Premier Growth Stocks.

Press the

OptionsPro button to

transfer the results

to OptionsPro.

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Choose Bull Put Spread

Your UniSearch Results…

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Send them to

the Matrix…

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Click on the Scan

dropdown arrow:

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Under Advanced Scan select,

Stocks w/Overpriced Options

Results are listed in order based

on the highest difference between

Implied Volatility (IV) and Historic Volatility (HV)

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Right click on a symbol

& chart the results.

SCLN is overpriced, but

lower than historical highs…

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LUV is near the

highest historical levels

of volatility.

HA has a better chance of

volatility moving higher.

Not a good option to sell.

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ProTip:Don’t overlook stocks at the bottom.

They still can be near the top of the

volatility range!

The Matrix allows you to focus

quickly on the best stocks

with the highest volatility.

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VV Search

Matrix

Filter

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We have a large list of

Stocks w/ Overpriced

Options from the Scan

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Save this list as a

new Scan List

These are only the Overpriced

Options from the original Safe

and Sound scan.

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Set the Matrix to scan for

Option Symbols

Filter for the best

candidates to sell.

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Down to one stock, and

you now know the right

options to build a spread.

VV Search

Matrix

Filter

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If this is the result of your

searching, it’s not

necessarily bad.

It’s not about trading for trading sake.

You want the Right Trades, with the

Proper Option market conditions.

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