The manner by which the HI Fund pays redemptions excluding unrealized losses creates a risk that, if the unrealized losses continue or there is a significant exodus, the last investors to redeem will not get any money. Did he use her later on to promote tasty Humans desperately want to believe there is a way to make money with no or little risk. In fact, be obsessed with risk management if you want to survive as a trader for the long term. To me, this alone is a huge red flag. Such attitude is a pity. Bollinger bands are an indicator that shows 2-standard deviations around a day moving average.
Karen Smith Instructor. Karen began her trading career in the early 90’s using mutual funds as her primary trading vehicle. She managed her portfolios while acting as comptroller of her family business. She was successful with her methodology but was always frustrated by the fees that mutual funds charged on top of commissions involved in trading.
IS this Karen Supertrader story legit?
I watched the Oct video a cpl of months ago just out of happenstance and was floored because her evolution of trading options mirrors mine in almost every detail I started the same time, made exactly the same mistakes, reached the same conclusions, trade only low delta index options selling credit spreads with what seems to be very similar mkt indicators, etc. Mar 22, , 6: Mar 30, , 3: Originally Posted by ironcondorz. Mar 30, , Mar 30, , 2: I don't see why it wouldn't be true.
At the end of the day, pure chance will create success stories like that. Some people like this will inevitably exist through pure chance and of course some will exist through skill and a large set of spheres. If you want to follow somebody like this, you need to figure out how much of their success was down to pure chance.
Not very easy that. Based on the evidence, I'm totally neutral on it. Mar 30, , 4: Originally Posted by BobbyBB. Thread Tools Show Printable Version. Search this Thread Advanced Search. Page 1 of Originally Posted by Trader Yes good points and the impression I got is that she was not using massive size and that only once in the last year was there any drawdown.
Jeff is recognized as an options trading expert in the private sector. He has educated thousands of investors, helping them achieve their financial goals. See Jeff's Full Bio. He is out to persuade investors that a stop-loss order is not an acceptable approach to risk management. See Charan's Full Bio. Karen Smith has over 20 years of trading experience. She began her trading career in the early 90's using mutual funds as her primary trading vehicle.
She managed her personal portfolios while acting as comptroller of her family business. After joining OptionsAnimal as a student in April , she quickly realized that this educational opportunity would positively impact her trading results for a lifetime. Do you think Karen is a fraud? This article aims to clarify some facts about Karen SuperTrader and her trading results.
First, few facts about Karen the Supertrader's strategy. The highlights of her strategy:. Before we start analyzing Karen the Supertrader's strategy, lets be clear: That number includes money from new investors.
This headline is misleading at best, deception at worst. With SPX currently at , she would sell May puts and calls. If she holds till expiration and both options expire worthless, the trade produces 3. This assumes that both options expire worthless and no adjustment is needed.
This also assumes regular margin. With her capital, she obviously gets portfolio margin, so her margin requirements are significantly less. But if she wants to take advantage of portfolio margin, she has to sell more contracts, taking much more risk.
Don't get me wrong, this is an excellent return - however, by selling naked options, she also takes a LOT of risk. If volatility spikes like it did in , her account will be gone in matter of days. Read my latest article: Too Good To Be True? I suspect that investors will not learn the lesson from this case. Humans desperately want to believe there is a way to make money with no or little risk.
TastyTrade removed all articles and videos related to Karen the Supertrader from their website and YouTube right after the SEC investigation started, but returned them few days afterwards. Do you roll forward to avoid exercise? You avoid exercise and generate a net credit. What can go wrong? However, it is not without some complexities. In essence, one must understand the whys as well as the hows or they will continuously be faced trying to resolve dilemmas along the way.
By Reel Ken, September 4. To illustrate the importance, I often like to point out both the power of compounding and the impact of taxes with a simple example. By Jesse, September 2. Selecting the right broker is one of the most important things for options traders. It becomes even more important if you are an active trader and trade hundreds or thousands contracts every month.
Select the wrong broker - and your chances to make money are going down dramatically. By Kim, August Binary options are an example. One of the greatest benefits to trading options is that you can make money in an up, down, or sideways market. In a bull market you can buy calls, or purchase bull call spreads and bull risk reversals. In a bear market you can profit buying puts, bear put spreads and selling bear call spreads.
By Jacob Mintz, August You can take a directional bet if you believe the stock will move higher or lower. Or you can play it with some of the non directional strategies. All traders begin with an introduction to call and put options. However, it's rare apart from short puts that an experienced trader would use these contracts by themselves. Instead, we primarily trade options spreads. There are many benefits to spreads. The variety of spreads are targeted to various market criteria and market environments.
By Drew Hilleshiem, August Almost all passive invest ment strategies are based on the assumption that younger investors should hold more equities as a percentage of their total portfolio.
Likewise, as they age and get closer to retirement, the allocation to fixed income assets should grow while equity holdings shrink. By Michael Lebowitz, August Options traders do not have to act as gamblers … even though many do. There may be a thin line between trading and gambling, and that line is obscured when it comes to weekly options. Thanks Kim, now it is very clear to me that this was a hoax. I tried selling naked puts, but was always baffled by low returns on margin and enormous risk.
In fact I am now in a naked put situation which is deep in the money and I had to either take possession of stock or roll the put out in time. I rolled 1 year out. Hopefully I will get out at break even. Premium selling is convergent while trend following is divergent. But nonetheless she is a very real person with a very real fund and real returns. Here is a filing for her fund with the SEC:.
I'm sure she would be happy to share her offering documents and audited returns with anyone if they are an accredited investor. The simple truth is that on risk adjusted basis, those are not very attractive returns. The risk is just too high. I can promise you that in , similar strategies would destroy your account very quickly. I don't care for the risk either which is why I didn't invest with Karen's fund. But my point is that she is indeed real and her fund is real and is not a hoax as some people think.
The point imho is that to use those level of risk is unacceptable no matter what time is it. Nobody can predict when a bs will occur. Chris is correct, Karen is operating a private fund available only to accredited investors. All trading has risk. It's not the strategy that determines if something is risky And past performance doesn't guarantee future results.
A subtle difference, but one is stating a historical fact while another implies something about future performance and is therefore a prediction. To the author of this blog post - report Karen and her fund to the SEC and ask them to review her fund.
They will decide if she is a fraud or not. This strategy will only work for a period of time. When it stops, the results will be catastrophic. But She does not need to do that for you, its not important. He got it spot on. What are the odds. The fund can grow fast because of prior year performance and her background being a huge seller. She probably has a deal with TastyTrade and other shows to help market. It also encourages people to join TastyTrade by showing how rich you "could" end up.
She appears to be marketing, Kim doesn't. There are quite a few people who made k on the downturn. Timing was by chance for them, as stock investing started becoming more popular around then to the retails. This was all she needed to start the fund.
Karen Smith has over 20 years of trading experience. She began her trading career in the early 90's using mutual funds as her primary trading vehicle. She managed her personal portfolios while acting as comptroller of her family business. Karen only trades options and started focusing on more than 30 underlying assets, which generally included stock indices. She currently only trades three indexes which include the S&P index (SPX), the Nasdaq (NDX) and the Russell (RUS). Mar 30, · Re: IS this Karen Supertrader story legit? Difficult to know, she claims to be working on price and volume with Bollinger bands and theta on indices using options. It maybe that the strategy is working in the market conditions that have been prevalent since