The One Investing Lesson They Don’t Want You to Learn

In trading and investing, as with any business you’re in, you want to turn a profit. When things are going great and profits are coming in, the business is thriving. When things take a turn for the worse, your winners come less frequently, and your profits become smaller.

That’s when things can get really ugly.

But just like in any business – or any part of your life, really – it is how you deal with losses that matters. Your ability to manage your losses is what truly speaks to the profitability of your trading business.

Unfortunately, many investors never learn this… because they don’t want you to learn it.

When I say “they,” I am talking about anyone who benefits when you lose money. That includes market makers, day traders, the big banks, sophisticated trading firms, or anyone on the other side of your trades.

Today, I’m going to show you the best way to deal with losses.

But to do that, you’re going to have to change your whole mindset…

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Make Sure You Know This “Delta Accelerator”

You should know by now that there are several factors that affect the price of an option – not just the price movement of the underlying asset.

The variables that exist that account for the fluctuations of options price movement are known as the options “Greeks,” and we’ve covered many of these – Theta, a measurement of options time decay; Delta, how an option’s price will move with price movements in the underlying; and Vega, how sensitive an option is to the Implied Volatility associated with the underlying.

I’ve told you that Delta is the single most important factor in determining an option’s price. Today’s “Greek” shares a special relationship with the Delta, measuring the rate of change in the most important component in an option’s price.

I like to call it the “Delta Accelerator.”

Here’s what I’m talking about…

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