Managing Editor’s Note: Crypto enthusiasts, clear your calendars tomorrow…
That’s when tech investor Jeff Brown is unveiling his invention – an AI tool built to spot special patterns in the cryptocurrency space. The goal is to turn crypto volatility into reliable profits.
So far, his AI has found 60-day windows that turned a series of $5,000 investments into $6,950… $9,090… $11,800… and more.
To learn how this all works, be sure to tune in tomorrow evening. Simply go right here to make sure you’re on the list.
And then read on to learn how you can control your risk when trading Bitcoin…
Maybe you want to trade Bitcoin…
But the volatility and high price scare you off.
You worry that if you buy in with prices up around $60,000 or $70,000, your account could take a hit if Bitcoin tumbles… just like a bit over a month ago.
From late July to early August, Bitcoin lost almost 30%.
And plenty of other times, it has fallen a whole lot more.
That’s why, as I wrote last Friday, I trade Bitcoin differently than most.
Today, I want to expand on that…
Reducing Risk
I use the ProShares Bitcoin Strategy ETF (BITO) and other Bitcoin-related stocks rather than trading Bitcoin directly. This can include Bitcoin miners and exchanges like Coinbase Global (COIN) as well.
This way, you can trade Bitcoin using your normal brokerage account. You don’t have to set up a crypto wallet or worry about an exchange being hacked.
And I go one step further than that…
I don’t buy shares in any of these stocks.
Instead, I trade Bitcoin using options.
To some, that might sound crazy. Bitcoin can be volatile, after all. And many people assume options would make trades even more risky.
But the opposite is the truth.
By buying options, I’m controlling my risk. When I open a trade, I already know the most I can lose – and I can adjust my position size accordingly. The price paid for the option is the most we risk.
And options give you another benefit…
|
Free Trading Resources Have you checked out Larry’s free trading resources on his website? It contains a full trading glossary to help kickstart your trading career – at zero cost to you. Just click here to check it out. |
Profit in Both Directions
Options allow me to easily trade Bitcoin in both directions…
That means we can also make money if Bitcoin falls – or even crashes.
If I think Bitcoin will rally, I could buy a BITO call option. (A call option increases in value if the underlying asset rises.)
And if I think Bitcoin will fall, I could buy a put option. (A put option increases in value if the underlying asset falls.)
In both cases, the most I can lose is the price I paid for the option.
So I can benefit from Bitcoin’s moves while limiting my risk. I don’t have to worry about Bitcoin tanking 30% or more… Instead, I can turn that fall into profits.
In my options advisory, The Opportunistic Trader, we’ve profited from Bitcoin this way with gains like 100.0%, 72.3%, 52.9%, and 41.7%.
Of course, like any other trading strategy, we’re not always going to get it right. There are times when things don’t go your way.
But altogether, this strategy can quickly bring in strong profits… and let you control your risk at the same time.
Regards,
Larry Benedict
Editor, Trading With Larry Benedict