Avoid High Risk Investments… Duh!
[Tip] – Avoid High Risk Investments…
I saw this piece of advice earlier on the interweb as being a “good piece of advice” for investing
I couldn’t help but think what I redundant piece of bullshit advice
Without any qualifier whatsoever, you might as well say “avoid juggling with kitchen knives”
High Risk in most contexts is what the dumb folk call;
“A good opportunity, but I don’t have a fecking clue what do with it!”
What exactly is a high risk, let alone a high risk investment?
If you don’t know what you are doing, you can lose money on low risk investments all day long as well.
Ergo, if you don’t know what you are doing everything is high risk investment.
As options traders, WE are smarter than the average bear (or bull). Firstly, because we divide things in to probability of success and personally Im looking to stack those probabilities placing my trading or investment opportunity more into my favour.
Another way of saying that is that I get to rationally determine what we think is a realistic outcome for every trade idea that I have.
This is regardless of what is or isn’t “risky” we get to put defined risk investment ideas on all day long.
Russia could blow up its little corner of the world and my high risk investment idea (expressed through RSX – ETF) and assuming I was wrong would never lose more than I defined when I put the trade on.
Muppets who spout out these “tips” most of the time have not got a clue as to where there arse is compared to their elbow.
Knowing what we know – WE can turn ANY supposedly high risk investment or trade idea into a defined risk investment opportunity because we spent a little time up front figuring this shit out.
Warren Buffet, as a part of his overall investment plan, released that has added $5billion in profits via options trading
If its good enough for Buffet (famous for low risk high yield results) then it is good enough for you and me