The Most Difficult Financial Test in the World
Welcome to Issue 005 of the Masters in Trading Digest.
Today we will share sound advice from Stacy Brovitz, a CFA Charter Member. The CFA is generally regarded as one of the top 10 most difficult certification tests in the world.
To become a full CFA Charter Member, members are required to pass each of the 3 Levels.
Historically the pass rates on each exam have been below 50%, making this series of tests one of the most difficult sets of financial certifications; a minimum of 300 hours of study is recommended for each exam. – Investopedia
We are also proud to report that in our Masters in Trading coaching program, we have 2 CFA Charter Holders, Stacy and Tony.
After spending roughly 100 hours studying for my CFA Level 1 exam, I passed back in 2012, but have yet to commit the time to studying for the Level 2 and Level 3 exam. One day…
Obtaining the CFA is an impressive accomplishment, so congratulations to the hard work and dedication put forth by Stacy, and Tony to complete this grueling task. Most don’t know how difficult this is and the sacrifice that comes along with the journey. Well done, Gents!
Below is Stacy’s advice for the holiday season. Listen to him. He’s smart and knows what he is talking about.
Jonathan
WHAT SHOULD YOU TRADE OVER THE HOLIDAYS?
In a word: NOTHING!!
Huh? As traders, we’re always looking for the next trade. Patience is not in our DNA. We’re driven by adding and taking off risk – and trying to make the next $100, $1,000 or $10,000. If we’re not trading, it feels like we’re going backwards!
A common question at this time of year is: “what’s your year-end trade?” The answer may surprise you: don’t trade and reduce your risk. Spend some time with family and friends, be grateful for the gifts you have and recharge your batteries. It’s not a time to add risk. Liquidity dries up, markets become slippery and volatile and moves can be extended. It is very easy to get caught in a trade you’ll regret.
Well, then what the heck should I do if I’m not going to trade?
Glad you asked because Stacy Brovitz explains it all in our newest post, What Should You Trade Over the Holidays on the Masters in Trading Insights.
What Other Ways Can You Increase Your Knowledge?
There is so much “educational” material out there that it’s hard to filter through all the noise to figure out what is valuable.
In the full post mentioned above, we share that there is a ton of free content on the Masters in Trading YouTube channel.
Two books we recommend to our Masters in Trading members are “Option Pricing and Volatility” by Sheldon Natenberg and “Options as a Strategic Investment” by Lawrence McMillan.
As we say, “education mitigates risk!”
NEW YOUTUBE VIDEO RELEASED
WHAT’S GAMMA SCALPING?
Simple really, Gamma Scalping is trading the underlying stock around an options position.
When traders are long options, they are faced with Theta Decay as a risk to holding that option. Theta decay is the risk of time passing before your option moves “in-the-money.”
The opposite of Theta = Gamma… cool, huh?
Traders learn to Scalp Gamma to make back the lost Theta when holding a long options position.
Watch this Video, Gamma Scalping and the 3 Ways to Manage an Options Position
“”Position Management Gold” – is how Pete R describes this video
HEARD IN OUR MEMBER DISCORD
I have been teaching traders relative value futures trading since 2003.
Learning to trade using relative-value takes time but for those who are patient, humble, disciplined, curious, creative and committed it’s the best trade in the world.
It makes me proud that Toris, and Jose are learning these valuable lessons.
FINAL THOUGHTS
WHAT TO EXPECT IN THE NEXT MIT DIGEST
The next issue of the MIT Digest will be released Monday, December 27, 2021.
Monday’s issue will reflect on some of the biggest market movers of 2021, and what we should prepare for in 2022.
Keep your feedback coming into support@mastersintrading.com. We’re excited to share your feedback along with fantastic suggestions for upcoming issues.
Until Monday, trade smart and always manage your tail-risk.
Have a wonderful holiday season.
Thanks for reading,
Jonathan Rose
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Masters in Trading Digest - Issue 5
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