Trading Pro System Intro

A lot of you know that I started my successful option trading career (yes, it’s my main source of income) with Covered Calls. Much of that success is because of John Brasher, his book and his Covered Call service called CallWriter (now out of business). Knowing that Covered Calls are essentially a bullish strategy, I looked for education on other option income strategies that would be useful under all market conditions.

For over a year I tried out 5 courses and services. My intent here is not to evaluate all of them, just to simply tell you about the one course that I took that gave me the most useful information and techniques with the least amount of investment. It was through this course that I learned about Iron Condors and Double Calendars and how to manage a portfolio and not just individual spreads.

This is a personal endorsement. You, my readers, know that I don’t do this without good reason. So here goes…

The Guru’s Favorite

The name of the course is Trading Pro System, but before you click on the link let me tell you a bit more about it from my perspective – why I think it’s worth much more than what they are charging for it. How much? $197? Really? You get the complete course – no up-sell or subscriptions – it’s all ready for instant downloading to your PC to watch at your leisure.

There are about 100 videos so it may take some time, but you can download the first two (start with MOD00) and watch them while you download the rest in the background. By the way, that $1.97 per video!

Trading Pro System (formerly known as Trading as a Business (I like that name better)) has been around for at least three years and maybe more – I signed up to Trading as a Business (again, same course content, just a different name) in October of 2009. These videos not only demonstrate in great detail the art of selecting and managing Calendar Spreads, Credit Spreads, Iron Condors and other option strategies, but also how to monitor, adjust and when to close them. Let me just say a bit more about adjustments: I attribute my recent success based on what this course taught me about adjusting and how, at times, it can be more profitable than the opening trade.

The bonus videos offer even more: The Greeks, using TOS, Gamma Scalping, Theta Scalping, Day Trading, Protective Puts, How to Tell When Money is Moving In/Out of the Market, and 56 videos of daily market assessments and commentary on open trades and portfolio management. Truthfully (and sadly), I have not even watched all of the videos yet!

David Vallieres

The course was developed, authored and presented by David Vallieres. He is not a former insider or market maker, but a retail trader like you and I, so he knows how to talk at our level and knows how difficult it is for retail traders to be successful. He is also an educator, which is why his videos and delivery are so captivating (at least to me) and professional. He has been trading since 1985 and has – like me – given many dollars to the market before he learned how to trade correctly. His primary philosophy is to keep it simple and not get caught up in analysis paralysis.

David’s Bio

I started trading in 1964. I was 14 years old. I also started my first business at 14 btw. I heard a story about a company that was making “the pill”. The company’s name was Syntex. I asked my father to help me buy some shares because I knew this would be a winner. My father took me to the only brokerage in town. I remember walking into a large room with lots of rows of chairs and an electronic ticker with stock symbols and share prices on the wall where all the chairs were facing. It was my first stock transaction. I bought 10 shares.

Since then I have studied the market diligently. I developed my own indicator from thousands of hours of study in 1994. I was trading options up and after the 1987 crash. I was able then (not now) to convert the options prices quoted in fractions to decimals 1/8=.125, 1/4=.250, 3/8=.375, etc… when communicating with my Kidder Peabody broker in New York. His name was Ned (an old timer). I remember one time I was long a bunch of puts, the market was down 60 points (a huge move back then) and Ned called me to ask what I wanted to do. He said he never calls his customers but I had a $32,000 profit so he called. I said “wait”. I called him back 3 minutes later and told him to sell. I lost $8,000 of profit in that 3 minutes, but I still made $24,000 on that trade – at the time I was making $12,000 a year in my job! I was hooked again.

Anyway some people questioned my background in trading because I am an Internet Marketer – before becoming a marketer I was Deputy Commission of Urban and Economic Development for my city. But neither of these qualify me in anyway to teach anything about trading. You are right to question everything. But the truth is I am a trader – always have been. But unlike many here I trade everything: I trade options, stocks, futures, commodities, rare books, diamonds and …information. I understand markets, how they behave, and how to profit from them. The Internet is a very profitable “market” and that’s why I am “in” that market.

I developed the course to help others see the profitable strategy that I saw in the stock and option market. But before I created the course I was mentored by a CBOE floor trader with 30 years experience. I had the money and I sought the best, most experienced and profitable professional I could find. It took me two years to find him but it was worth it. What I learned + my own experience is in this course. Good luck everyone and happy trading.

So, look over the Trading Pro System web page and make your decision. There’s a 60 day money back guarantee so how can you really go wrong?

As David says, “trade with confidence”; and as always, if you have any questions, please feel free to ask.

Happy Trading

◄ Jeff ►

  • Gary Tarantino

    Hi Jeff
    i bought that course ages ago, i have sent numerous emails asking a question and have never had a reply back, seeing as you are marketing his course, maybe you can shed some light on this.

    • Gary – I can’t tell you why they (David Vallieres) don’t answer your email – I never got an answer from mine. The reason I promote this product is because it’s a great option education tool for a very reasonable price. Many other vendors charge hundreds or even thousands of dollars for just one strategy.
      So, if you have a question, ask away!
      Happy Trading ◄Jeff►

  • Ah. Good to know.

  • Zelts,
    The answer is to go the this web site: http://www.winningtradesystem.com/invitation/
    and start there,
    Happy Trading ◄Jeff►

  • Duke1025

    Hi Jeff,
    What is the difference between Trading Pro System and the Winning Trade System?

    • Duke,
      Winning Trade System is updated and geared to smaller accounts. The total number of videos is much less that the Trading Pro System.
      Happy Trading ◄Jeff►

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  • Bharath – if the strike of your option is In The Money, then the value will be equivalent of the amount the strike is in the money at expiration. If it’s Out of the Money and it appears to have value, it will be zero 5 minutes after the close on Friday. There should be no deviation to these rules.

    ◄Jeff►

  • Mike,

    Here’s a bit more about my day trades…

    I only use AAPL, currently. Only ATM Weeklys. Starting on Thursday, I use the next weeks expiration. I enter with 2 contracts with a exit limit at 0.80 and 1.20 and stops for both at 0.80.

    If the first order is successful and I have the time to monitor, I will adjust my remaining order maintaining the same stop and limit spread (2.00). I use Active Trader in TOS (see attached pic).

    Happy Trading ◄Jeff►

    • Mike Cleveland

      Looks interesting, Jeff, thanks much for sharing. I haven’t tried trading this way before but may consider it shortly.

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  • Angela

    Hi to everyone. I have been following the blog in the last months and I like it very much (thanks Jeff for petting it togader).
    I also started to learn Dave’s system and I like it. The first month I traded it (paper trading), i got some good risults. The last month it was a bit tough because of the directional move we had and some mistakes I made. I lost some money (papertrading . I want to continue papertrading and emprove my skills, but I am facing a big problem now, that can kill all my efforts. I have a TOS account and TOS wrote me today an email: i have to close my account until the 12th of October. I do live in a country that is not eligible for TOS any more. I feel a bit desperated. I live in Italy and don’t understand their policy. I don’t know to which broker I should move to have a decent Risk graphic and portfolio analyses like Tos offers. Has any one an idea to which broker I cold move?

    • Angela,
      You might want to take a look at Interactive Brokers, it’s the first that comes to mind for international taders. They have a module in their Trader Workstation called Risk Navigator. It’s not as powerful (yet) as TOS, but they have a pretty good start. You can learn more at http://ibkb.interactivebrokers.com/node/1410

      I am a former client of IB and I’ve made many observations, posts and videos related to their platform and brokerage. My only complaint is that they charge for order cancels and modifications – and it ain’t cheap!

      Many say their platform is difficult to learn. I agree, it is, but what new platform isn’t?
      Good luck, and if you have time, let me know what you think.

      Happy Trading
      ◄Jeff►

  • Sid

    David, I think the course is worth many times the price I paid, it is invaluable in its contents and helped me learn a skill that I never know existed. So Thank you again. I am going through the adjustment video for SPY. I love the concept and understand the process of adjustment. You adjusted the CALL spread as the live price was attacking that area. In order for you to recover the loss you incurred in that adjustment, you also had to roll the PUT spread up. As a matter of fact, you sold a brand new IC and bought back the previous one. Is my understanding correct? If yes, could we have done the adjustment as a new IC sell and close the previous as TOS is charging 9.99 per trade + 0.75 per contract and this would have saved one trade. Many thanks.

  • ‘Nuf said.

  • Hi everyone it’s David Vallieres. I want to thank Jeff for his blogging about the course and I want to thank you all for your comments. I started trading in 1964. I was 14 years old. I also started my first business at 14 btw. I heard a story about a company that was making “the pill”. The company’s name was Syntex. I asked my father to help me buy some shares because I knew this would be a winner. My father took me to the only brokerage in town. I remember walking into a large room with lots of rows of chairs and an electronic ticker with stock symbols and share prices on the wall where all the chairs were facing. It was my first stock transaction. I bought 10 shares. Since then I have studied the market diligently. I developed my own indicator from thousands of hours of study in 1994. I was trading options up and after the 1987 crash. I was able then (not now) to convert the options prices quoted in fractions to decimals 1/8=.125, 1/4=.250, 3/8=.375, etc… when communicating with my Kidder Peabody broker in New York. His name was Ned (an old timer). I remember one time I was long a bunch of puts, the market was down 60 points (a huge move back then) and Ned called me to ask what I wanted to do. He said he never calls his customers but I had a $32,000 profit so he called. I said “wait”. I called him back 3 minutes later and told him to sell. I lost $8,000 of profit in that 3 minutes, but I still made $24,000 on that trade – at the time I was making $12,000 a year in my job! I was hooked again. Anyway some people questioned my background in trading because I am an Internet Marketer – before becoming a marketer I was Deputy Commission of Urban and Economic Development for my city. But neither of these qualify me in anyway to teach anything about trading. You are right to question everything. But the truth is I am a trader – always have been. But unlike many here I trade everything: I trade options, stocks, futures, commodities, rare books, diamonds and …information. I understand markets, how they behave, and how to profit from them. The Internet is a very profitable “market” and that’s why I am “in” that market. I developed the course to help others see the profitable strategy that I saw in the stock and option market. But before I created the course I was mentored by a CBOE floor trader with 30 years experience. I had the money and I sought the best, most experienced and profitable professional I could find. It took me two years to find him but it was worth it. What I learned + my own experience is in this course. Good luck everyone and happy trading.

    • David,
      Thank you for providing more on your background. I have never questioned your qualifications – it didn’t matter to me; the material speaks for itself. Your course (Trading Pro) has done more to improve my trading and knowledge than any other single or combination of courses I have take in the past. Yours is the material that refer back to repeatedly Thanks again.
      Please visit my blog often and comment whenever you can.
      Happy Trading ◄Jeff►

  • Hi everyone. It’s David Vallieres. I want to thank Jeff for blogging about the course and I want to thank you all for your comments.

     

    • David – Thanks – Jeff

  • David

    Jeff,
    I purchased this set of videos near the start of the year and they are great.  There is always more to learn but David really taught me a lot about how to trade the market so that you can make money when it goes up, goes down, or doesn’t move.  One subject he doesn’t discuss much is volatility, so buyers should be aware that they’ll need some more education on that, but for learning about selling spreads for monthly returns (I hate the term “income trades”) the Trading Pro System is a great place to start.  It also shows off the Think or Swim platform to great effect.

    • David,
      Yes, a tremendous value for the price! You probably noticed that the recording were made at the start of the 2008 crash, and IV was very high – so his trades were very profitable – but he had to do a lot of adjustments, which I don’t like to do.
      If you’re looking for education on volatility, make sure you catch as many swim lesson chats, from the likes of Don Kaufman, as you can.
      Happy Trading ◄Jeff►

  • miniFORTUNE

    Hi Jeff:
    I’m indeed very lucky I came across your videos on YouTube tonight. I made my decision few months ago to start all over again and after studying  several scenarios I am committed now to only one thing: CREDIT SPREADS. I was paper trading for two months on monthly expiration, always avoiding the weekly expiration. I came across you and another sincere guy on the web and I could see the potential on the weekly’s.  
    I will be funding my trading account in a month or so. The first money I earn will be invested on the Trading Pro System. By year end’s everything should be running smoothly.
    I have a very heavy foundation on how to trade the credit spreads. My severe weakens is how to use the Think or Swim platform. That  is why tonight I was looking desperately for training videos on TOS. Luck was smiling at me tonight when I spotted your video.
    From the bottom of my heart, THANK YOU!
    Hugo

    • Hugo,
      Thanks for the comment and the encouragement. Trading Pro will not let you down and will open your eyes to other option spreads – you will gain insight into why Credit Spreads are excellent directional trades.
      I haven’t checked and verified, but TOS says that they have added several training videos to their web site that you might be interested in. Check them out.
      Good luck to you and keep me posted on your progress.
      Happy Trading ◄Jeff►

  • Ron

    Thanks for the info jeff. After watching your videos on YouTube I decided to give this a try. I bought the system and will be studying the videos over the next few weeks. 

    • Ron,

      Let me know what you think.

      Happy Trading ◄Jeff►

      • Ron

        Hey Jeff, 

        The video was worth every penny. I having been using the on demand(amazing feature) and playing through the last few years. I will be placing my first real position soon.

        • Ron,
          You’re approaching it logically and correctly. Yes, the videos are worth much more than we paid for them. To this day I still refer back to them several times a week. Keep me posted.
          Happy Trading ◄Jeff►

  • W,

    Start with the MOD’s, with the lowest numbered one. After I viewed mine, I changes the names a bit, but I believe originally there were numbered 000 to 11. Watch 000 to 08, then practice, then watch them again and again before going live.

    Later you can watch the others since they are a bit advanced.

    Don’t worry about the date. In truth, there are only two kinds of option spreads: Verticals and Calendars. All other spreads are simply combinations of those two. Therefor, the strategy still works no matter what the date is.

    Happy Trading
    ◄Jeff►

  • Stephen,

    Yes, he is an internet marketer, but as I mentioned in my review, he is a retail trader too. He took the time to be mentored for many years in option trading and as a result created almost 100 videos to share his knowledge with others.

    He’s not a former floor trader, he hasn’t been on CNBC – he’s just like you or I. His videos opened my eyes and helped me to understand spreads, Greeks and portfolio management. That’s why I endorse his course. For the price ($197 – and you can check around) I don’t think you can get a better education. But, that’s my opinion.

    I think there may have been a copyright violation with the original Trading as a Business name, but don’t quote me on that. Also, he took on a partner about the time the name changes, so maybe that has something to do with it.

    Happy Trading
    ◄Jeff►

    • Mike

      Honestly, the videos by David really didn’t help me much. His adjustments were unclear to me, and IV was so high when he was trading that you could throw a dart at a stock and sell premium and make money. Things are entirely different now (in 2013). Jeff, do you have someplace on your OG site that shows your trading methodology?

      • Mike – Yes, see my methodology on my YouTube channel at http://bit.ly/134p6Q4 (my blog is more of a v-blog now).

        This method can be used for any time frame on anything that has a price chart. Although I don’t talk about it, I use it to day trade options as well – using 1 and 3 minute charts.

        One other item – I have never been able to get any adjustment to work for me. I find that well thought out orderly exits to preserve profits or minimize loss works best for me. You can pick some of that up in my Daily Scans on YouTube.

        Are you a pilot?

        Happy Trading ◄Jeff►

      • Hi Mike- You’re absolutely right about IV levels and how it affects trading with the system. The audience for these videos was for advanced traders and I emphasized what the implications of volatility had on the system but maybe not enough so in a follow-up report on the system in October 2008 I made it clear. The ideal level to initiate a trade with the system is when volatility is 30-40 and coming down. Right now in 2014 IV is 10-15… there’s no premium to be had. That could change overnight though and often does 😉

  • Ejklucy02

    Hey, anyone know what happened to Callwriter.com? The calculator is gone and so is the website. Also, they are not returning calls or emails.

    • You and several other readers are experiencing the same thing. John is a friend of mine and I am unable to contact him as well. I hope all is well, but we must assume CallWriter no longer exists.

      ◄Jeff►

  • Mikecj62

    Hi Jeff, Thank you for the great amount of information you have here! I truly appreciate that!

    As far as Trading Pro, I purchased it and tried it. It really has lot of nice information and you can start thinking about different strategies. As far as the strategies itself, they do work in theory ( i was able to make money in paper trading). However, when you add transaction cost to the list, the profits just disappear.
    I will not discuss the strategy since its a paid course, but i will give you the numbers. I created a portfolio with 2 instruments, each with 2 legs in them. It was total of 40 contacts in each instrument  for total of 80 Contracts. In the middle of trade I did adjustment once, so removed 10 contacts and added 10 different one. My profit was around 500 within 4 weeks which is really good considering my margin was only 2000. However, when i add the transaction cost for the trade in TOS it was ~ 320. So my actual profit was 180. If you end up making more adjustments – i guess you will need at least 2 or 3, the profit will be even less or noe. I think it all comes to having a broker with low commission. I have tradestation which charges 1.00 per contract, however I get charged for modifying orders. Please let me know if you know of any broker which has a low commission for Options. TOS no longer has 1.5 / contract (which is not cheap either). They now charge 9.95 + .75/contract.

    David is a nice guy and you can hear that he is a REAL trader. But I guess he is really busy and dont expect to get any awnsers for your questions unless you are a paid member of daily reviews. I like vendors with money back guarantee and honour it. So David gets full marks there! As I said before, you can start thinking about different strategies and i will explore more.

    • Mike,

      First, let me address your commission cost. For your example, you opened with 80 contracts. Under the new TOS/TDAmeritrade price structure, the commission would have been $69.99, which is cheaper than the $1.25/contract that I pay. Your two 10 contract adjustments would have been $17.49 each. Assuming you closed early with a total of 80 contracts, you would have been charged another $69.99. The total is $174.96.

      The new pricing structure in TOS/TDA is beneficial to those that trade more than 20 contracts in a single transaction. For me, that doesn’t work out right now, since I rarely trade more than 10 in a single spread. That’s why I like to use higher priced underlyings – usually $80 or more. There may be a day when I graduate to a higher number of contracts and at that point I will convert to the new pricing structure.

      There are other, cheaper brokers out there and I have considered researching on TOS and trading somewhere else, but it would be too much of a headache – I’m willing to live with the costs for all the features. Also consider: 1) No change or cancel order costs and 2) you can close short options that are worth less than a nickle for free.

      David is a bit of a recluse, isn’t he? I have attempted to contact him several times and never had any success. That’s alright, though – his course is worth a pot of gold.

      Looks like you are doing quite well so far. I hope it works out for you. Stick to the rules – that’s my biggest downfall.

      ◄Jeff►

      • Mikecj62

        Hi Mike, Thanks for the reply! The numbers are little different. When I sell a Iron Condor  lets say for SPY in TOS with total of 40 contracts, it splits 2 legs separately in commission . So total commission one way  for each legs is (9.95+.75*20). So total for 2 legs is = (9.95+.75*20)*2 =  69.95. So with 2 instruments in portfolio it will be 69.95*2 one way. For both ways it will be 69.95*4 =~ 280. For Adjustment it will be ~ 36. Thats why the total commission is ~ 320.  
        Yes, Davis is reclusive. I cant blame him, he might be busy trading . Let me ask you one thing and appreciate your suggestion. Whats your thought on building a portfolio with opposite correlated instruments ? For example, I tried building a portfolio with TLT & SPY with the idea that they move opposite (in general, not a rule). My theory was that the opposite moves will offset each other and tent will remain in the middle. Thats how i was able to pull 500. But I am not sure if its a sound theory as might be exposing myself in both directions. Appreciate your response! 

        • Mike,

          Funny you should mention TLT – usually on my initial entry list along with SPY or IWM. For FEB I entered with IWM.

          Generally, I agree with your logic. However, a lot depends on the magnitude of the move towards the walls of the tent. If that’s not equal between the two, then the logic falls apart.

          Another way you can save some commissions is to move your short/long strikes further apart. This will increase you return but it also increases your risk. I wrote a blog post about this and I came to the conclusion that for the index ETF’s, 2 strikes is the most advantageous.

          Adjustments are expensive, so try to avoid them at all costs. Set a minimum profit goal and if you have hit it and you think you need to adjust, just get out – don’t leave money on the table.

          You were right about the number of contracts – I tried to hurry with my response and miscounted. Another senior moment, which seem to be coming more frequently, I think. Huh?

          One last thing – when Dave recorded his videos, it was the beginning of the financial crisis. Volatility was high (ergo high returns) and he was biasing his trades with a perceived trend. That can significantly increase your return as well – if you are right!

          ◄Jeff►

  • mahesh

    IS IT AVAILABLE IN ACTUAL “CD” OR “DVD” FORMAT ?

    • Mahesh,

      Unfortunately, no, it’s not available in disk format. Best way to do it that I have found is to get an 8 gig memory stick and put them all there. That makes it portable and viewable on many of the newer TV’s.

      ◄Jeff►

  • Frank A

    Greetings Jeff,

    Well, based on your “high marks” for the Trading Pro system I popped for the $197 and took the plunge.  Sure hope it isn’t another dead end rabbit trail like many many others I have traveled.

    I was quite leery because the two gentlemen shown as the producers of the system are basically internet marketing types out to sell things on the net.  You comments indicate the David V is/was “actually” a trader.  He probably now makes more from selling Trading Pro than he does trading.

    I like all the information on your blog.  Just so much to get one’s head around 🙂

    You come off as one who is sincere in what you present and are really trying to be a help to floundering newbies in the trading world.

    Blessings to you and Mrs…

    Frank A

    • Frank,

      I know about David’s history of internet marketing. I also have often wondered about people that sell/promote systems to make money. What is the motive? I can tell you that David still issues a daily update, so he continues to keep up with the system and the market. My guess is that he likes the concept of multiple streams of income – nothing wrong with that.

      Myself; I have many times been tempted to offer a system or pick service, but I just don’t want to be committed to starting a new business at this point in my life.

      So I just plug along, posting thoughts when they come to me and when I am motivated and cherishing dedicated readers like you. I get a lot of traffic to my blog and that is enough to satisfy my small ego. I just love to teach, that’s all.

      I have found that you need to practice, practice, practice – over and over. Don’t expect instant results. Watch the videos, try the strategies for 3-6 months while repeating the videos. It’s the only way. I have had mentors that have taken as much as a decade to figure it out. When they do, they realize it’s a matter of discipline and record keeping. Setting rules and following them to the letter. That’s the way it’s done.

      Good luck to you, Frank, and let me know if you have any questions or more comments.

      Jeff

      • Hi Jeff… just a quick comment about “selling and promoting my system”. The truth is that after I created the videos I wasn’t interested in selling or marketing them because I do own an online publishing business so I Licensed them to a number of resellers – they are all independent resellers. I DO NOT receive a penny when those resellers make a sale of the system. I wanted to get the videos to as many people as possible and I knew I could not do it alone. Should I have kept the rights to sell the videos myself? I would have made a lot more money if I did! But I still think I made a good trade – I reached, and hopefully helped, a lot more people by Licensing them.

        • David,

          I don’t hear from you enough! Thanks for the comment. Now I must clarify: I don’t care if you became a millionaire or what, with your videos. What I do care about is how they helped me. Dollar for dollar, yours is the best value out there.

          I was speaking from experience – some systems, as you are well aware, cost thousands of dollars. Some services cost hundreds of dollars a month. After getting raped several times, I stumbled on your system. Thank God.

          I made an assumption that you, or someone, is still doing the daily updates. When I started mine, about 450 videos back, it was a great help to get me focused and ready for the day. Thanks for that idea.

          Keep in touch.

          Happy Trading ◄Jeff►

  • Kevin

    Hi Jeff,
    I went thru the site. The site claims five explosive strategies will make thousands of dollars per month. I wonder if it is true. Your trading account does not make that much every month. Any reason why you do not use thsoe strategies?
    Thanks

    • Kevin,

      There are many factors involved. First, your return depends on how much capital and the amount you want to risk. My goal was about $1,000/month and I didn’t always make it – that would be true with any strategy. If anyone tells you any different they are lying.

      Second, David V. uses higher delta short strikes than I am comfortable with. This allows for a higher profit but also higher risk requiring more adjustments.

      Ultimately, though, I was most impressed with the knowledge I gained on options and strategies. For the price you can’t beat that.

      ◄Jeff►