Are The Markets Rigged Like A Casino?
Imagine this… You’re brand new to gambling and you walk into a casino for the very first time. Not knowing much about the games and assuming it’s all up for chance, you start walking toward the Poker tables. For some reason, the dealer and some of the men surrounding the table start smiling as you ask for the basic rules of the game and join them. They know you haven’t done this before, and they’re drooling at the chance to win your money.
How Options Trading Is Different
Much like the casino example above, having knowledge of how the game is played makes all the difference. However, unlike a casino, there is no house advantage. The markets aren’t rigged by anyone. However, it can sure feel like they are when you don’t have a clue how to read the signals to spot good opportunities and avoid bad opportunities.
Just like gambling, the markets do carry a certain amount of risk. In investing though, individual investors like you or I have the ability to tilt the odds of success in our favour.
Tipping The Odds in Your Favor
You might be asking yourself… “Ok, guys… I get it. The markets aren’t rigged. There’s a strategy behind it and with the right specialized knowledge I can genuinely make money every day in the markets, but HOW?”
Here’s some real tips and general rules of thumb:
- Know your signals. When you’re using great software to monitor the market conditions, you’ll see colored areas that indicate a good trade, a risky trade and a bad trade. You’ll quickly be able to spot trends and know when to jump in and when not to.
- Don’t invest everything you’ve got. It doesn’t matter how good the trade looks, manage your capital in such a way that you’re never going to be completely out of the game.
- Spend some time in practice mode before you put real money on the line. Everyone has the urge to start making some money… their trigger finger gets itchy, and before they know it they’re pouring money out with rookie mistakes.