I often get requests for simply providing an option to trade; hence we have our Pick of the Day. It works well and we are very proud of its success. And this pick is also provided by a human who manually analyzes the market and selects a particular option to trade on market open.

Some programs, however, let a computer program make the selection and delivery. While they may be mostly positive, ‘mostly’ is the operative word here. What do you do when the stock falls outside the parameters required of the computer program? Just because a computer makes the pick does not make it right. And when do you recognize it may be a bad trade, when it hits zero? Black box trading can be right 99% of the time, luring you in to a false sense of security. So you go full in and then Bam! It whacks you with a loss!

Black box type trading has its place. If you are unable to watch markets all day, perhaps this may be your best alternative. Day Trade SPY’s Pick of the Day is very profitable but we also like to encourage users to study the ‘Repairing Trades’ module so you can fix any bad position, should the need arise on those rare occasions.

I also suggest that instead of simply taking a computer’s pick, to instead, learn what moves markets so you can make intelligent decisions on your options yourself. It’s very liberating when you understand what drives options and that there really is no mystery behind any of it. Even losses will be easier to handle when you recognize where you may have stumbled.

Got the black box blues? Master the methodologies behind the trades instead!

 

~ Hugh Grossman, Head Trader at Day Trade SPY

February, 2020

 

 

 

Hugh Grossman is the founder and Head Trader at DayTradeSPY and uses his vast experience to teach his methods to make consistent daily gains trading SPY options. Join Hugh in his interactive Trading Room to see how he regularly pulls in the profits!

Want to learn how to day trade SPY options? Join us in Hugh’s Trading Room – a program designed to fast track you to success. You will be able to watch Day Trade SPY traders, Hugh and Alex, daily in an interactive setting.

Still have questions? Book a free 30 mins personal chat with Hugh or Alex and find out if trading SPY options is right for you!