Options Trading College


Subject: Planning

Instructor: The donFranko

Sessions: 2


Tools Needed: Willing mind, desire to succeed, sense of humor.


Training  Home


Entry is Key...Exit is Everything! TM

Session 1 

Greetings to my fellow traders,

This is the first step in your journey to financial independence. I would like to say I find it an honor to share my knowledge with you; and my sincere hope is that you come away with a sense of confidence on your way to wealth.

Let me begin by telling you how I first got stated in this fantastic business of trading for a living. I have always been fascinated by the stock market, but figured (like most would be investors) you needed a lot of money to make money. My first exposure to the market was in 1984 when I worked for an investment firm in Los Angeles, California. I worked in a department called “Investment Control" and each morning the VP's would come out of their meetings and enter my department to place their trades for the day. It was an amazing thing to see them come in morning after morning and spend literally millions of dollars on stocks. What was more amazing was I had a board above my head that showed the buy and sell orders each day—If I only knew what I had in my hands at that young age.

Well, as I moved on in life, I left that company to venture out into the business world because I had dreams of running my own business and I was not cut out to be an employee since I had that entrepreneurial spirit in me as far back as I can remember. Back then, I did not give stock investing a second thought because I was convinced you needed the big bucks like that company had to really make any money.—this was very true back then since there were no discount brokers and day trading back in the early 80's. In fact, just to put a small trade would cost you well over $150 bucks so the small investor was way out of their league.

When I started my first business (direct mail advertising) I was young and very ambitious. I had high hopes of building an empire back then but always had the desire to invest in stocks. I remember one day while I was stuffing envelopes, a good friend of mine was telling me about a company named Microsoft (MSFT). He said they were new on the stock market and he believed they would be huge some day. He even went on to say I should take my $30k in the bank and invest it in (MSFT) and not look at it for 10 years. I argued with him that Apple computer was the wave of the future and Microsoft  was some silly little software company. I went on to lament that Apple would crush them because they made the hardware, and their operating system was much easier to use than DOS. My reasoning was biased because I owned Apple computer equipment and knew first hand the operating system was superior to Dos and the early Windows platform. We  laughed about it and went back to stuffing envelopes. What pains me the most is how prophetic he was and how short-sighted I was for not digging deeper into investing. After all, I was building an empire that would make me millions of dollars. I had no idea how the power of compounding and stock splits would make you rich.

After 10 years passed, I looked up Microsoft and realized that one piece of advice I received would have changed my financial life. In fact, it gave me a whole new perception on investing in stocks because had I took that advice and put my $30k into either stock, I would have over 1 million shares today because of all the splits MSFT and AAPL did over the past 20 years. Of course  it's always easy to look back, but you need to realize this is not unique and it will happen again in the future, so start looking for upstart companies and buy all the shares you can get your hands on—then hold onto them forever!

Once I realized what should have happened to me, I began my journey mastering the markets and started to learn about stock investing. As I grew in my knowledge, another phenomenon was beginning in an industry called Options and Day Trading. There were a lot of new books and seminars touting the quick profits you could make trading options on stocks. One day, I was listening on the radio to an Investor who was selling his seminar on how to make big money in the stock market day trading options. He said it did not take a lot of money or time to get started and you could use this thing called "leverage" and play options on stocks. Because I  had  experience with options on real estate and inventories, I understood what he was getting at, so I decided to take his course, and when I finished it, I was amazed at the potential.

After careful study, and when I thought I understood his strategies, I funded my first trading account and proceeded to make my first trades; however, I did make the typical mistakes and thought I had it all figured out, but after a few thousand dollars of hard knocks, I started to wise up and take the business of trading seriously.

I can only hope you learn from my costly experience, and do not repeat the typical "new trader" mistakes as we move forward.


Trading (Start Here)


Controlling Losses



A month in the life



A month in the life


Day Trading Intro


Covered Calls



Naked Puts

Naked Calls


Pair Trading




Model Portfolio

Day Trades

Lotto Trades



Training Links


Bull/Bear 180's

Day Trading

Risk Free Trading

Hit Options Lotto


Session 2

Now, the lessons begin!  

Those who fail to make and follow a detailed trading plan have already planning to fail!

The first thing you want to do is memorize my section: "Thou Shalt Not!"

Print these rules out and post them on your wall. Read them every day for one month and paper trade before you put a dime of real money in the market. The great thing about trading for your living is there is never that "once in a lifetime" opportunity to make a bundle of money—every day is a new day with endless opportunities!

Remember! If you practice first, you will reap much more later; however, If you play first with limited knowledge—as I did—you may never reach your potential because you will most likely lose all your money due to lack of proper knowledge and the experience.

The second thing you need to do is set up a budget for trading. Too many times new investors jump in with all their trading capital on a trade they think is going to make them rich. I have been down that road friend and it leads to financial ruin. If you hit the homerun your first time, then you better watch out as you will have set yourself up for a big fall later and the loss will be substantial—slow and steady wins this race.

Build your account to a massive one and once you have a large pile of cash, then you can venture out into the risky type trades for your buried treasures.

Finally, the third and most important thing to do is write out a sold trading plan. You see, if you do not know where you are going, how can you ever expect to get there? You must have a precise reason to trade, a goal for your profits, and an exact contingency plan for unforeseen variables like news events etc.

Now that we have these crucial things covered, you can start on the most important skill...study. Experience is always sweeter when you gain wisdom first rather than pay tuition in the markets. Do not blindly trust anyone—including me—to give you the knowledge you need to profit. Take the initiative to master trading by learning first and then applying that knowledge to experience. If you never learn how to fish, then how can you expect to feed yourself? I blindly followed supposed "guru's" of trading, and let me tell you, it cost me tens of thousands of dollars because I never learned all the pitfalls until I started experiencing them—most educators are more like snake oil sales men giving you the promise of riches without telling you about the definite downside to trading.

So allow me to save you a lot of pain and suggest a different approach. When you seek the advice of others (including this site) you should always consider it confirmation of your own due diligence before you make a trade with real money. Remember, we are not the fountains of all knowledge here at www.Optionradio.com , but we do have a few things to offer.

After you have completed your research, the next step is to test your picking abilities with small amounts of capital. I would recommend only going into the waters with a single option contract as you will be quite nervous for a while. If you trade stocks, you should not allocate any more then 2-5% of your total capital per trade. If things go your way after a couple of days, then you can add to a winner on pull backs.

Too many times we want to think we have it figured out so we add to a loser with a double down mentality, and that my friends, is a first class ticket to the poorhouse.

Once you are in the trade, stick to these trading rules:

  1.  Keep greed in check by having a trading plan.

  2. Be sure to set stop losses and stick to them!

  3. My rule of thumb is to secure my option profits with protective trailing stops.

  4. Be sure you are familiar with your broker, the market and your decisions on how to handle losses. Yes, I said losses, as you will no doubt have many of these along the way. Even the best laid out plans will get side swiped by unforeseen events, and a stop-loss will not help you there either—I will cover this later.

  5. Always keep cash reserves to cover mistakes and/or capitalize on day-to-day opportunities

  6. Do not fully invest in any single option trade as you will no doubt lose every time to fear of loss when the trade or market turns ugly.

  7. Stay guarded and alert, as you are about to enter a war zone out there!

Remember my motto: Entry is key....Exit is everything! TM

Profits Up!

The donFranko 


If you feel that I have taught you a valuable lesson, then consider Subscribing to my members only site for access to my live portfolio's, daily suggested plays and my Lotto Trades!

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