No one ever said life was fair. And I doubt any of you are under the illusion that things on Wall Street are fair either.
Everything about the way the market functions favors big institutional players… they have a clear edge in the market and they eat it all up…
… and smaller players are typically left with their crumbs and left at a disadvantage.
Don’t Hate The Player…
Hedge funds and the like pretty much have unlimited resources to track down information that helps them predict stock price movement.
This includes access to first-class research from some of the country’s top analysts. Stuff you and I will never get our hands on.
It also includes what you’ve – no doubt – heard about before, “insider information.”
While we all know that it’s illegal to trade on such information, that isn’t enough to stop them from placing bets on it.
Instead, they’ve become masters at hiding it.
You’re probably asking yourself, if the game is rigged, how are average traders supposed to compete?
Change Your Game
The easiest and best way I know how to level the playing field is by trading options.
Options have numerous benefits over stocks.
Two of the biggest ones are that they are less expensive than equities and they provide immense leverage.
In other words, you can spend less money to make much higher percentage returns than you would from stocks or ETFs alone.
For example, let’s say you thought the broader market was headed higher.
As an investor, you might purchase shares of SPY, the popular and highly liquid ETF that tracks the S&P 500.
As many of you know, this is my favorite trading vehicle.
SPY is currently trading around $290 per share. If you purchased 100 shares of the ETF at that price, you would spend $29,000.
Let’s say SPY traded up to $292. That $2 move represents a gain of about 0.7%.
Now, if you wanted to purchase a call option on SPY instead, you might pay just a few hundred dollars to control the same 100 shares, meaning you have significantly less capital at risk.
And that same $2 move in SPY could translate into a double- or even triple-digit return on the call option — often within a very short amount of time.
In addition to being cheaper and offering a higher profit potential than stocks, options offer another big benefit over equities.
Options allow you to bet on a stock going up or down, essentially doubling your profit-making opportunities.
While buying a call option allows you to bet on the underlying stock or ETF moving higher, buying a put option allows you to profit from the underlying moving lower — without the excessive risk that comes with shorting the stock outright.
When you buy an option, the most you can lose is the money you spent to purchase it.
If you attempt to short a stock and fail (and this is often the outcome, especially for beginners), your loss potential is theoretically unlimited because we never know where a stock could run up to.
When you consider the benefits of trading options over stocks, I’m always a bit miffed at the number of people who shy away from them.
But at the same time, I get it.
Think for a moment about the thousands of stocks and ETFs that you could potentially trade.
If you’re an options trader, there are hundreds of options that might trade on any given stock or ETF when you factor in all the different combinations of strike prices and expiration dates, plus the fact that you can trade either call or put options.
I wake up at 3 a.m. each day to analyze the necessary charts and data to select my Trade of the Day — a single option trade on SPY.
Imagine what it would take to select the right options to trade from the entire universe of stocks out there.
How can you possibly hope to narrow it down?
Another Major Way To Level The Playing Field
Kyle’s strategy gives traders just like you a huge edge in the markets by allowing you to follow in institutional traders’ footsteps (legally!).
Kyle is one of RagingBull’s top options traders and his latest breakthrough exposes Wall Street’s buying and selling patterns so you can profit off of their activity.
Over the past few months, he has developed a proprietary scanner that tracks “insider” options activity.
These trades aren’t likely to be spotted by the untrained eye. But Kyle knows just what to look for.
Specifically, he’s looking for large blocks of activity that signals “insider” buying in the options market.
These huge positions aren’t by mistake. They are telling him someone on Wall Street knows something we don’t.
(Kyle is holding a live training TONIGHT at 8:30 p.m. ET to show you exactly how his scanner works and how you can start using it. But you must register now to attend.)
For example, Kyle’s Dollar Ace scanner recently spotted some insane movement in EXEL calls.
Exelixis (EXEL) is a mid-cap biotech firm that focuses on cancer treatments. But what the company does isn’t really important.
What is important is that Kyle spotted some seriously unusual call option activity.
The way his scanner was lighting up, someone must have known something!
In particular, Kyle saw 2,306 EXEL September 20 $22 Calls traded for $0.35.
Well, the next day, the company backed out of a conference and buyout rumors began to fly.
That day, those calls that had been trading for $0.35 hit a high of $1.73. That’s a nearly 400% move!
Think about that.
While shares were just up a few percentage points at their high of the day, options traders could have made 4 TIMES THEIR MONEY. That’s the leverage I was talking about earlier.
So, whatever insider knew something beforehand and purchased those EXEL calls was sitting pretty.
Anyone who rode their coattails thanks to Kyle’s system could have made just as much.
Kyle’s system probably sounds like it’s too good to be true. That’s why he’s agreed to share it with a select group of traders tonight at 8:30 p.m. ET.
And bring your questions. He’ll be doing an in-depth Q&A after he reveals the Dollar Ace secrets.