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During
every year you've been
alive, there have been
ample opportunities to
take money out of Wall
Street. Have you gotten
your share?
If
you haven't, it probably
has a lot to do with how
you make stock market
decisions.
Are
you a buy-and-holder?
A short-term trader? An
indexer? A seeker of value,
a cycles follower, a technical
analysis whiz-kid, a dividend
collector, a high-growth
chaser? A rumor mill addict?
A chart-reading wizard?
A dyed-in-the-wool balance
sheet bean counter? A
Warren Buffett wannabe?
A Peter Lynch devotee?
Or
a...
Simplespreader?
Do
you know which stocks
to buy, what price to
pay for them, when to
buy them, how to buy them,
how to hedge them, how
to manage them, and how
and when to sell them?
Which,
what,
when,
how,
and most important - why?
And
can you make consistent
decisions trade after
trade, month after month,
market after market?
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Simplespread
Strategy
can.
It
is
the
ultimate
in
consistent
thought
&
action
for
seeking
out
profits
in
the
stock
market.
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The
strategy you
choose should
be consistent
throughout
all types
of markets.
Don't be lulled
into the mistake
of thinking
that you'll
be able to
switch strategies
when the environment
changes. You
are assuming
you will accurately
predict all future bull
and bear markets.
Nobody has
ever done
that with
any consistency.
Nobody ever
will because
it involves
too many indeterminables.
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with
The
Simplespread
Strategy,
you
don't
need
to.
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Markets
are psychological
phenomena.
Value is in
the eye of
the (stock)
holder. Stocks,
bonds, gold,
cattle, baseball
cards, Swiss
Francs, a
piece of real
estate, a
Van Gogh original,
a vintage
Model T, a
Cabbage Patch
doll.... Today,
they're all
worth exactly
what someone
will pay for
them...TODAY.
But the act
of investing
is determining
what someone
will pay for
them TOMORROW.
And that's
what The Simplespread
Strategy is
all about.
During
my 12 years
as a member
and market-maker
(aka specialist
or trader)
on the floors
of the Chicago
Board Options
Exchange
and the
Pacific
Stock Exchange,
I had the
opportunity
to try every
possible
stock market
strategy
ever invented,
as well
as watch
other traders
try every
possible
stock market
strategy
ever invented,
plus invent
a few of
my own.
The trading
floor became
a laboratory
to test
results
in real-time
(and real
money) experiments.
A few traders
and strategies
succeeded,
but most
didn't.
Family,
friends,
and acquaintances
would call
to ask for
my investment
advice.
"Hey,
buddy,"
they'd say,
"you're
right there
in the middle
of the action.
Give me
the latest
rumor. What
looks good?
What do
you like?"
The problem
was that
they were
talking
"long-term"
and I was
trading
short term.
My idea
back then
of long-term
was a couple
of hours
from now.
I could
be a buyer
in the morning,
sell out
everything
by noon,
then go
short in
the afternoon,
counting
on a big
drop by
the opening
tomorrow
so I could
cover.
But after
several
years of
making excuses
of why I
couldn't
really be
of any help,
this concept
of the trading
pit being
a laboratory
began to
take shape
in my mind
as to what
non-floor
traders
could do
to make
money in
the stock
market.
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Since you, as a public investor, cannot make hundreds of trades (decisions) a day while watching the news as it is reported minute by minute or watch the order flow as it comes in from the investment houses, I wanted to find something that would be workable for your situation. I traded options so that was where I began my search. Throughout history, call options have been the greatest game in town...for the seller. The unique characteristic of call options is that they are time-wasting assets. They live a limited life. Every day, their value, vis-à-vis the stock they are convertible into, wastes away. Taking advantage of this time decay should be part of everyone's investment strategy because it is the most consistent aspect of making money in the stock market.
Selling call options also provides you with two additional benefits: it sets a price objective for your investment and it sets a time objective for your investment. In a word, we're talking about setting...GOALS. As the saying goes, "If you don't know where you're headed, you won't know when you get there." By selling options on stock that you buy, you'll know where you should be headed and you'll know how long it should take you to get there.
Okay, so the foundation of any profit strategy should be selling call options on stock that you buy. After you buy stock and sell call options, if the stock goes up, you profit. If the stock goes sideways, you profit. If the stock goes down a little (less than what you receive in return for selling the call options), you profit. And if the stock goes down more, at least you reduce your loss, plus there are alternatives that enable you to take additional measures that might even save you from taking that loss. |
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Aha!
Profits
if the stock goes up.
Profits if the stock goes
sideways. Profits if the
stock goes down a little.
That means in more than
2 out of the 3 possible
outcomes from your stock
investment, YOU PROFIT.
And remember, the only
reason you invest is make
a profit. So, play the
game to win.
Now,
with the odds of profitability
on your side, I added
a simple but reliable
filtering process to choose
stocks that are most likely
to rally during the immediate
future. Then, drawing
on what I experienced
on the trading floor,
I added the most advantageous
point at which to buy
these stocks. Eventually,
in 1986, my research
and study resulted in a stock-option
combination called The
Simplespread Strategy
- a refinement on the
basic "covered call
writing" concept. I presented the strategy
in the book Dr.
Simplespread, or How I
Learned to Quit Losing
and Started Taking Money
Out of Wall Street.
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It
was
a
fictionalized
account
of
a
seasoned
investor
who
had
tried
every
conceivable
stock
market
strategy
but
still
lost
money.
The
storyline
followed
him
as
he
searched
through
the
canyons
of
Wall
Street
seeking
out
high-paid
gurus
to
help
him
overcome
his
losses.
But
each
guru
was
worse
than
the
one
before.
Finally,
a
young
shoeshine
boy,
learning
of
our
hero's
plight,
told
him
of
a
little
old
man
who
worked
in
a
step-down
brownstone
and
taught
people
the
simple
way
to
make
money
in
the
stock
market.
Our
investor
found
the
man
known
as
Dr.
Simplespread
and
spent
a
couple
days
in
his
"war
room."
When
he
left,
he
no
longer
wondered
about
how
the
stock
market
worked.
He
now
knew
how
to
make
stock
market
decisions,
and
he
was
ready
to
go
home
and
start
his
new
life
as
a
successful
investor.
Favorable
reviews
came
in.
Don
Borneman,
pension
officer
at
Consolidated
Natural
Gas
in
Pittsburg,
said
at
the
time,
"Damn
good
book."
But
there
were
two
big
obstacles
for
the
public
in
implementing
the
Simplespread
Strategy
in
the
late
1980s:
(1)
high
commission
costs
and
(2)
insufficient
(and
uneconomical)
computing
power
to
scan
thousands
of
stocks
for
the
right
price
patterns.
We
professionals
on
the
trading
floors
had
the
access...but
the
public
didn't.
So
the
Simplespread
sat
and
waited.
Fast
forward
to
the
Internet
revolution.
By
the
year
2000,
online
discount
brokers
had
cut
commissions
down
to
where
they
barely
mattered.
And
advances
in
computing
power
made
scanning
through
10,000
stocks
faster
than
you
could
say
gigahertz.
The
other
thing
I
learned
from
the
1986
experience
was
that
wealth
seekers
wanted
their
investment
education
organized,
stripped-down,
and
presented
in
the
closest
thing
to
an
easy-to-follow
manual.
They
didn't
want
a
good
story,
they
wanted
a
detailed
roadmap.
The
new
and
improved
result
as
I
return
to
the
classroom:
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"80
Rules
For
Taking
40%
a
Year
Out
of
Wall
Street"
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80 Rules
300 pages
(8 1/2"
X 11"
soft cover)
14 chapters
100 charts
28 illustrations
15 tables
12 graphs
4 forms
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A veritable
manual of
how to make
money in
Wall Street
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Chapters
1 to 6 of
80
Rules
ready you
psychologically
for the
steps
you will
be implementing
in Chapters
7 to 14.
Mental
preparation
first, then
action.
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Part I: The Basics
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Chapter
1
-
Basic
Rules
Chapter
1
of
80
Rules
begins
with
15
basic
concepts
on
how
the
stock
market
works.
These
are
required
reading
if
you
are
ever
to
have
any
chance
to
consistently
profit
in
the
stock
market
over
the
rest
of
your
lifetime.
Included
in
this
chapter
are
"Overcome
the
2
reasons
you
lose
money,"
"Rotate
or
die,"
and
"Understand
the
psychological
drivers."
It
takes
you
from
the
basic
covered
call
writing
strategy
through
what
makes
the
stock
market
tick.
It
finishes
with
"Learn
one
strategy,"
"Learn
that
strategy
well,"
and
"Learn
what
to
do
next."
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- Chapter 2 -
Disregard...
Chapter 2 of 80 Rules teaches you to filter out the noise. Wall Street is filled with enough manure to fertilize all the rose bushes between the White House Rose Garden and Portland's International Rose Test Garden. Eight "Disregards," from the "news," to the financial underpinnings of securities analysis, to the most hallowed of Wall Street strategies, are dissected and discarded.
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- Chapter 3 -
Habits
Chapter 3 of 80 Rules teaches 7 habits of successful investors. Five "do's" and 2 "don'ts."
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- Chapter 4 -
Goals
Chapter 4 of 80 Rules explains how to set goals and why goals are the bedrock of any investment program.
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- Chapter 5 -
Tools
Chapter 5 of 80 Rules lists 7 tools you will need in order to set up a successful investment program. Brokerage accounts, websites, publications, etc.
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- Chapter 6 -
Study
Chapter 6 of 80 Rules outlines additional works to study in order to master the art of taking money out of Wall Street.
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Part II: The Simplespread
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- Chapter 7 -
Find the Right Stocks
Chapter 7 of 80 Rules begins The Simplespread Strategy of searching out the right stocks. By process of elimination, you will be led through the necessary steps to find those few stocks that best meet your stringent requirements.
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- Chapter 8 -
Buy the Right Stocks at the Right Prices
Chapter 8 of 80 Rules takes you through the steps to locate the exact right price at which you should buy those right stocks.
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- Chapter 9 -
Sell the Right Calls
Chapter 9 of 80 Rules explains what call options are, how they work, and how to choose the right call options to hedge those right stocks that you buy at the right price.
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- Chapter 10 -
Enter into The Simplespread at the Right Time
Chapter 10 of 80 Rules determines the right time to buy The Simplespread according to regular fluctuations in the major averages.
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- Chapter 11 -
Getting In
Chapter 11 of 80 Rules instructs you on how to get into The Simplespread. It includes the calculations that must be made, the restrictions you must put on the investment, and the entry of the order.
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- Chapter 12 -
Chapter 12 of 80 Rules concerns itself with the managing of The Simplespread. It covers the business aspects of The Simplespread Strategy.
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- Chapter 13 -
Getting Out
Chapter 13 of 80 Rules shows you how to get out of The Simplespread. This chapter summarizes each of the possible scenarios that can and will happen to the investment while you hold it. How you get out of an investment is much more important than how you get into an investment.
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- Chapter 14 -
Wrapping it up
Chapter 14 of 80 Rules wraps up the foregoing
content
by
summarizing the complete course on how to take money out of Wall Street. It emphasizes proof that it can be done.
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Appendices
Forms, lists of charts
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By the time
you come
to the end
of The
Simplespread
Strategy,
you
will have
learned
to go from
the chaos
of 10,000
stocks,
to a limited
number of
prime candidates.
By
the time
you come
to the end
of The
Simplespread
Strategy,
you
will have
learned
to go from
buying stocks
at whatever
price you
hear about
them, to
one limited,
opportunistic
price area.
By
the time
you come
to the end
of The
Simplespread
Strategy,
you
will have
learned
to go from
no better
odds of
profitability
than barely
1 out of
3, to better
than 2 out
of 3, complete
with firmly
established
time
and price
goals.
By
the time
you come
to the end
of The
Simplespread
Strategy,
you
will have
learned
to go from
entering
the market
whenever
you get
the urge
to buy,
to a point
in time
when both
the stock
and the
market are
most likely
to rally.
By
the time
you come
to the end
of The
Simplespread
Strategy,
you
will have
learned
to go from
fear and
trembling
at the thought
of having
to make
another
stock market
decision,
to the comfort
of a consistent
methodology
that you
can understand
and implement
continuously
for the
rest of
your life.
By
the time
you come
to the end
of The
Simplespread
Strategy,
you
will have
learned
to go from
hit-and-miss
panics and
manias,
to a professionally
self-managed
investment
portfolio.
By
the time
you come
to the end
of The
Simplespread
Strategy,
you
will have
learned
to go from
acting on
emotion,
to closing
out positions
in a rational,
planned-out
way, designed
to take
advantage
of the best
deal Wall
Street ever
gave you.
By
the time
you come
to the end
of The
Simplespread
Strategy,
you
will have
learned
to go from
a state
of
confusion
to the satisfaction
of one,
consistent,
decision-making
approach
to the greatest
wealth-making
machine
mankind
has ever
devised.
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Simplespreading
is not for
most
investors.
We know that
when everybody
is using one
strategy,
that strategy
will no longer
be profitable.
(Remember,
a trade is
based on a
difference
of opinion.
You buy from
someone who
wants to sell,
and you sell
to someone
who wants
to buy.) But
we rest assured
that as always,
a great majority
of Wall Streeters
will continue
to bypass
this "best
deal"
ever created,
happily wasting
their time
searching
for that long-shot
fabulous growth
stock which
might soar
1000% or that
unearthed
bargain-basement
value which
no one else
has found.
We know that
only a relatively
few investors
are really
serious about
growing their
investment
funds geometrically.
We also know
that only
a relatively
few investors
are willing
to spend the
time and energy
required to
learn about
this ageless
technique
that has stood
the test of
time. So,
let others
haphazardly
chase the
hare while
you plod along
on the road
toward the
goal of taking
40% a year
out of Wall
Street. Then
see who ends
up at the
finish line
first. Investing
is a process,
and it is
the journey
from Rule
#1 to Rule
#80 that gets
you to your
destination. |
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DO
IT NOW
| (1) |
Make
the decision today
to use the best
strategy available
to investors - The
Simplespread Strategy™. |
| (2) |
Begin
today to gain the
confidence to make
the right decisions
at the right time...continuously. |
| (3) |
Learn
Simplespreading
today in order to
save time through
standardized decision
making. |
| (4) |
Choose
your method of how
you wish to learn:
Hard Copy Manual,
CD, downloadable
eBook, or Seminar. |
| (5) |
Resolve
today to put the
odds of profitability
on your side and
enjoy investing
for the rest of
your life. |
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- Do it for
the losses you've
already suffered.
- Do it for
the profits
you've already
missed out on.
- Do it for
for your and
your loved ones'
future.
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Warning:
Don't risk another
dollar in the stock
market without it.
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Remember that
each day, each week,
each month, each year...somebody
is
taking money out of
Wall Street.
Why not you?
The
Simplespread
"80
Rules for Taking 40%
a Year Out of Wall Street"
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Disclaimer
Simplespread.com (The Simplespread
Strategy™) is an educational website, not a registered
investment advisory service, and therefore does not give
investment advice. Neither the information contained herein
nor the opinions expressed throughout this website constitute
a recommendation to purchase or sell any types of securities.
References and illustrations using stocks and call options
are for demonstration purposes only. Neither the author
nor publisher have financial interest in any securities
used for demonstration purposes. All information and data
are taken from sources believed to be credible but accuracy
cannot be guaranteed. Both stocks and options involve considerable
financial risk and are not suitable for many investors.
Any funds placed at risk can lose real money. Consult your
financial consultant, advisor, broker, banker, lawyer, accountant,
psychologist, or other professional before committing funds
to any investment. As in any learning experience, confirm
the facts and theories on your own prior to embarking upon
any at-risk investment program.
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