The charts will tell you, on a high probability, there's nothing. There's
nothing certain because things change right. You could have a really good news today
and bad news tomorrow. But the charts will tell you you'll be able to
start to see. Okay, this is some signs that things are starting to
reverse, and I jump in long before the big pop move happens. You're
listening to Carrie Letz's Financial Survival Network, where you get valuable information you just
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Welcome you are listening to watching the Financial Survival Network. I'm your host,
Carrie lets Well, you're gonna get some trading advice today from somebody who lost
everything five times but now makes two to four hundred percent per year. His
name is Tony Pollack. Tony great to have you on, and I should
also mention that the site where you find Tony at and the link will be
in the show notes Real Life Trading a dot com. If you got a
question, comment you can email me kl at Kerry Lutz dot com, whether
about trading or anything else economic or any other questions you might have on your
mind. Tony. It's great to have you on. So a normal person
would have quit probably after the first time they went bust, the first or
second time. Certainly very few people would have hold out doing that five times.
How did you keep going in the midst of all that defeat? Oh
man, Yeah, that's I figured out I was not normal. That's what
I learned from that experience, for sure. Thanks so much for having me
on. By the way, you know, I just I felt like I
was being called to trade, and that's one of the reasons why I didn't
give up. But I really didn't have Like I got rid of every other
avenue, like this was my only path there were There was no backup plan
to really fall back too. So I had to make it work. And
I think that's what kind of stuck me, kept me in the game long
enough to finally find some success. But look, if you could make it
trading, there's probably half a dozen a dozen other ways you could have made
it. Something about trading really made you keep going, correct. I ran
a family business for quite a few years before that, and I managed a
lot of employees, and I love the fact of trading that I could do
it anywhere. It was just me, grag it was just I only relied
on myself, and there was a few things that just kind of gravitated me
towards trading. So that's why I chose this career, and that's why I
was so passionate to stick through it. Plus I love the markets all right,
I love them too, have ever since I was a little kid.
But hey, in this day of AI, I mean we even have an
AI bought taking notes on this interview now for our show notes. Can the
individual really compete against the bots? Yes, because you don't have to compete
against them, you can join them. And there are you know, there's
two teams in trading. Everyone says the game is rigged, and it is
rigged. But but here's the catch. You can choose what team you can
you want to be on. You can choose the winning team or the losing
team. And that's what people don't realize. AI all it's designed to do
institutional traders. All the big money is designed to play on people's emotions.
If you get a million people in a room. It's really hard to predict
what they're gonna do. If you can get all million people to feel the
same emotion, it's very likely they're going to do the same thing. Right,
If smoke starts to fill the fill the auditorium and then fire them goes
off, odds are you can get a whole lot of people to do the
same thing. And that's all the game really is. The thing is people
don't even realize there is a game. They're showing up and they're immediately being
part of the big crowd, and the big crowd is always going to lose,
and so they're playing on your emotions now, and you're just going to
struggle to survive. And so again, if you compete against it, you
are in the ninety percent that's going to fall. Instead, you can join
the winning team and start thinking about the markets differently and start thinking, all,
right, what are the majority of people doing right now? Well,
the markets you're screaming up, they're all going to buy. They're all have
that confirmation. This feels easy. People love to buy when it's already going
up because it makes them believe it's going to continue to do that. In
reality, that's where all the big money's taking their profits, they're selling it
to everyone else knowing it's getting ready to pull back. And so just little
things like that, of knowledge of that's what I do. I teach people
how to be different. I went through the whole gauntlets, so they don't
have to, right, And so I average a few thousand hours a year
just showing people like, hey, don't think this way, you need to
start viewing it this way. Just little tweaks that really make a big difference.
And finally being successful in the markets. All right. So one of
my fa favorite little memes is live life as if it's rigged in your favor.
So certainly this would be one day one way of going about that.
What do you you know? What do you buy? How do you know
what to buy? And how do you know when to sell? Vice versa
sell and then buy? Yeah, price action. The charts will tell you
on a high probability, there's nothing. There's nothing certain because things change,
right. You could have really good news today and bad news tomorrow. But
the charts will tell you you'll be able to start to see, okay,
this is some signs that things are starting to reverse. And I jump in
long before the big bump move happens based on certain sentiments that I'm looking for
in certain tools and things that I use. But I'm a big price action
trader, so the charts tell me, first off, where I'm wrong.
I'll look at this and go, this is a level the bulls have to
hold. So as long as they hold that level, I'll stay in the
trade, and that allows me to control my risk and to lose small.
It's just a game of math. Right, you were flipping a coin on
heads. You get a thousand dollars on tells, you pay me three hundred
bucks. You can flip it as many times as you want. The math
works because when you're right, you're making way more than the opposite of the
coin when you're wrong. So I'm setting my risk where if I am wrong
again, it's a probability. I'm putting high probabilities that it'll go up.
But I know exactly where I'm wrong based on the charts. And so if
the charts telling me, hey it gets below this, I'm wrong, I
cut my losses. Everyone else, the crowd, the ninety percent, they
hope it turns around and they end up turning a small loss into a big
loss, and then when I'm right, I ride that thing out as far
as I can. I make a lot of money doing that. Everyone else
they're up three hundred dollars like I made that in ten minutes. I'm getting
out. This is amazing. And what they're doing is they're guarantee they lose
big and they win small in the math just keeps going against them. So
they answer that question would be price action. It'll show you when to get
in. It'll tell you a really good idea of where the majority of the
algorithms and the big institutional traders will start taking their profits, and I just
try to follow them and what I'm doing. Okay, So what's the market
telling you? Know? What are the shorts telling you? Oh man,
great question. We're at a pretty key spot right now. Four twenty level
is very very crucial. We're at the spot where either the bulls should step
back in and push this thing back up to an all time high. That's
what I'm expecting at the moment. If we start taking out certain levels and
closing below that, that would tell me the bulls didn't step in. So
again, that's kind of how I can get an early indication of if the
bulls don't step in. All the institutional traders are thinking the same thing.
They're cutting their losses, they're getting out, They're gonna start shorting, and
that's what I'll be doing too. So we're at that moment in the markets
where over the next three weeks, we're either going to decide if we're gonna
really keep finding some bulls and keep pushing all time highs, or if this
party is already over with and we're getting ready to retest last year's lost.
It's sitting around on that verge and I don't know. I just have a
game plan for either scenario, and I'll see which one plays out. Are
you invested now or are you just sitting back and waiting. I am invested,
yep. So I do a lot of option trading. So I bought
a lot actually last week at my key area when we got down to the
four twenty area. And then I personally, I buy a lot of insurance
on the markets. I buy a lot of put options on the market.
And what that does is it gives me that two or three month cushion to
see, Okay, now I can wait three or four weeks to see if
we're going to bounce. If not, then my insurance will ensure that I
lose very very small. And if I'm right, then cool, I'm gonna
lose small on the insurance compared to what my overall position is going to win
on the upside. Okay, So like how much money you need to use
your system? Yeah, really it's I work with people that have a million
dollars trading accounts, all of it down to a thousand dollars. It's more
of what percent returns are you're going to get. So I shoot for and
I average five to ten percent a month on average. Some months or sixty
percent some months are losing months, but five to ten percent a month is
what I try to get my students too. So if you have a thousand
dollars, you know you'll make five to ten percent of that. If you
have a million dollars, you make five to ten percent of that. So
it's really more of you can use any number really you can throw in there.
Technically you could have two hundred dollars and do this, but of course
the larger the number, the easier is to trade. There are more options
out there for you and more methods for you to use to make money but
also the return is a lot higher. So what's been your biggest success so
far? Biggest trade, biggest trade? I would say last year. I
ended up buying buying some puts at the start of last year, and I
tripled my trading account within the first five months of last year. So that
was one of my best trading years so far. Of just again, the
charts told me a key levels broke the second week in January. I just
waited for my entry, had my setup, took it, and then rode
that thing all the way down throughout the year. Yeah. So buying options
a little tricky, you know, it's hard to know whether you're paying too
large a premium or the premiums at a discount. How do you value options?
Yeah, so options really come down to it. It's a whole other
game inside of a game. Really. The quick question is, once everyone's
seeing the same thing, it's too late. I want to be buying options
when no one's thinking about a bowl move, right, when no one's thinking
about a bear move, that's the time to grab it. And again,
it's all about reading price action. They'll give you those clues and then you're
either right or you're wrong. Off of those clues. There's nothing guaranteed,
so I just if I'm wrong. I'm wrong all the time by the way,
I take small losses, and when I'm right, I went big.
So when reading options, it's more of figuring out is the move already happening?
Right? Go back to a You can look at the previous price of
the option itself and you'll see it's like, oh, okay, it was
at a dollar two days ago. Now it's at three dollars. So I
could get in now because it could go to six. But I have to
realize that people already bought this at a dollar. They've already three x their
money. You know, am I late to the party? And so that's
what I use a lot as The key is I want to get in.
I want to be buying insurance before there's a hurricane type thing, right,
and so then selling that to someone else. And that's the game of options
really. But it requires a knowledge of how the markets work a little bit
to be successful. Okay, so interesting, interesting thing here These options though
they don't always reflect the reality though do the the price Sometimes price will go
way up in the underlying security and they lag in the options. You know,
you can be right, but you can be wrong. Right. If
you don't understand how options work, you'll set yourself up to fail. Really
because if you buy this is the easiest way to think about it. Few
analogies. If you if you buy insurance, let's say for a hurricane,
but your insurance only applies if the winds get above one hundred and eighty miles
an hour or two hundred and fifty miles an hour, and the hurricane comes
in at eighty mile an hour winds, your house still gets destroyed. You
add insurance, but it didn't cover what you what actually the damage that happened.
Right. We see that a lot in like car insurance. Right,
Like you didn't have insurance for a tree dropping on top of your car.
So it's the same thing. In the markets. People buy options way too
far out of the money, which means not only do that to be correct,
but the markets have to make an abnormally large move in that direction for
them to even really be at break even by expiration. So I teach my
students, so you want to be buying your options a lot closer and strike
so there's a higher probability, right, don't buy a hurricane insurance with a
wind cut off, just buy the insurance for anything to cover you. So
that's one of the best ways to do it. But people mess up the
most by they go the cheapest, which means the option furthest out of the
money, and then when they're right they're like, oh, the market's worked,
you know in my direction, they still don't make any money because it
didn't go far enough. The second kind of analogy is if you're in a
baseball stadium and you know, outside that stadium the hot dogs two dollars.
On the street vendor, it's two bucks. You go inside the ballpark,
it's eight dollars. If you're trying to buy options to make money right before
earnings, there's a volatility that goes in. There's a there's a higher premium
on price because they're expecting a large move right before earnings. So that's like
you going into the ballpark buying twenty hot dogs for eight dollars, going on
the street and trying to sell them for twenty bucks. It's a really hard
way to make a living because you're paying too much for that option. From
the get go, that option might be worth two dollars normally, but because
of earnings, it's seven. So after earnings is over with, that option
goes back to the normal market rice. So even if the markets made a
big move in your direction, it might only be worth five dollars, but
you paid seven for us, you still lose. So those are the two
scenarios of that I commonly see people why they lose money and options, it's
more of a matter of understanding how the game is played and how to apply
the option at the right time you'll be successful. So what options do you
usually buy? Do you buy them on the stocks or the indices? How's
that work? Yeah, I'd buy them on any stock that gives me.
First things first, you've got to diagnose the markets. Right. Options are
just a tool to make money. It's not the thing that actually is going
to make you money. What's going to make your money is diagnosing the problem.
Are the markets about to go up? Are they about to go down?
Or are they going to go sideways? Right? Once you have a
diagnosis of the markets, that's what I teach everyone to do. First things
First, diagnose the markets. Learn how to read price action. I teach
it. He messages me, I'll give you a bunch of free stuff to
learn how to do that. Once you know how to do that, then
it's now a matter of Okay, it's going to go down. I want
to buy these options that make money when it goes down, So I do
it on any stock or any and to see that I have a clear diagnosis
of where I think this is going to go. The majority pity of my
money would come from selling options, though, I would say that's the easiest
way to be consistent, because ninety percent of the people are going to lose
that trade options. I'm the one selling it to them, so I have
a ninety percent win, right, I win when everyone else loses. Type
thing. In that sense, it kind of sounds weird because that's not really
how it plays out, because they could sell it beforehand and everything else.
It's just I'm taking advantage of I'm buying that hurricane insurance when it's not season,
and I'm selling it to someone that didn't have it right before the season
starts for a higher premium than what I sold it. Four type thing.
So that's how I'm making a good chunk of my money is just by selling
options. You're selling covered calls and such. Sure, yeah, yeah,
yeah, I'll do you covered calls. I do a lot of naked puts.
My main go to his credit spreads because it doesn't require a lot of
capital. I have people to have a couple thousand dollars in their account that
make three hundred dollars a week just on a couple of credit spread trades,
because again, it doesn't require a lot of margins from your broker, a
lot of money from you. But yeah, you can still take all the
benefits of selling options with a really high win. Right. Are you doing
any energy options at all? I have not. I have not really dabbled
into that. I could. I stick I do a lot of spy trading,
so the ETF, and then I'll do a lot of higher volatility stocks.
The tech stocks are always fantastic, always have been Tesla and a lot
of those things. But I'll dabbling things. I just haven't really gotten into
dantage it too much. All Right, Well, I think you've given us
a good a good background, and we'll definitely have you on again to talk
more about it. In the meantime, how do you get started in trading
with you? Yeah, for your listeners, I've actually created just a step
by step process of how to do all these things I just talked about for
free. So if they want to go to Real Life Trading dot com slash
Tony Pollock is where they can find that step by step. You can also
go to Real Life Trading dot Com to figure out some more education for free.
We're all about just giving back, and that's all I want to do
is help people give back and learn this and stop making the same mistakes that
everyone always makes. Yeah, so that's that's why I want to Now you
can find it all right, well, the link is in the show notes
to this interview on Financial Survival Network dot com. Make sure you sign up
for your free newsletter. Questions, comments, I'm always here for you.
The email addresses kl at carlets dot com. Use the use the comments section
in the YouTube if you're watching it, there to give us some feedback on
what you think and how your experience has worked on trading options. If you've
traded options, let us know, and if you haven't, let us know
why not. Hey, Tony, appreciate you coming on. We'll definitely have
you on again. Be well and my pleasure. Thank you, thanks for
listening to carry Lets's Financial Survival Network. Your solution to today's trying times for
the latest go to Financial survival Network dot com Ential Survival Network now more than ever,