Trading Methodology
Our options trading system was developed by Erik Epp, Ph.D., senior strategist and editor for K.I.S.S. Options. It is based on a carefully calculated algorithm that has taken Erik many years to develop and optimize. Used in combination with select technical indicators and fundamental analysis, the algorithm evaluates both the range and the direction of the market.
“This unique options trading system has predicted the market range with an incredible 90% accuracy and has been proven to work in rising markets, falling markets, and even sideways markets.”
K.I.S.S. Options Advisory takes advantage of market movement and short-term volatility to generate solid and consistent returns while still working to protect your investment capital. It incorporates two strategic trading concepts:
- Balancing carefully calculated risks for the opportunity to achieve greater potential returns.
- A conservative risk-adverse approach that is consistent and produces attractive returns with lower risk and costs.
By putting these two strategies together we believe this gives the best diversity in the options trading arena.
To achieve returns on investment with lower risk and cost we primarily use two main trading strategies:
- Covered Calls: You buy the shares of the underlying (stock/ETF) and sell call options against it.
- Covered Writes and Diagonal Spreads: This is when you buy longer-term options and sell shorter-term options against it. You DO NOT own the shares, only THE RIGHT to own them at a predetermined price (strike price) and for a limited time period (depending on expiry date). The initial cost or cash outflow is much smaller than buying the actual shares.
This will allow you to:
- Own shares of a company or ETF (underlying) at an attractive price
- Get paid to own the underlying, on top of any dividends offer
- Reduce the risk (loss) of owning the underlying
- Reduce the cost of owning the underlying
To achieve maximum potential return we incorporate all of the following four option trading strategies:
- Buying and selling options
- Credit or debit call spreads
- Credit or debit put spreads
- Covered calls / Covered writes
