Welcome to the Agora Outlook!
We use a unique program for trading index options which is opposite of the buy and sell method of trading options. What we do is sell options using credit spreads and outright selling techniques and watch the premium evaporate over time. We mainly trade the S&P 100 and 500 cash and futures indexes. Besides our trading program, the publication is designed to inform you of significant economic news, the mood and technical condition of the market and relevant trade data by e-mailing it directly to you. If there is an important news event that moves the market we also let you know about it right after it occurs!
The special emphasis of the Agora Outlook is its unique trading program. Established in 1990, the program concentrates on trading U.S. indexes. It has been tested with key option indexes since 1982 and to date has produced an impressive 94% reliability. Since it began actual trading in 1990, the program has produced very nice returns per year. The program has never had a down year!
Simply put, our trades involve selling options in a way which gets time working for you instead of against you. Most people who buy options do so to make a profit on a rising or falling market. Unfortunately, over 88% of all index options expire worthless! The problem is, the index may go the wrong way or it may not go anywhere so the investors premium in the option slowly decays. As each day and hour goes by, the option moves closer to expiration reducing the time premium! A trade can be profitably made if the market is moving up, down or even sideways! This gives investors the opportunity to make money 66% of the time instead of only 33%, which is the case when you outright buy for either a rising or falling market. This means that our program has a much higher success rate than the traditional buy and sell method! We apply a mathematical model to the market to find trades that make time work for you instead of against you. This is what makes our program unique! We always try, if the opportunity presents itself to trade the market on both the upside and the downside as our program supplies the upside and downside closing boundaries of a particular expiration cycle. This also means that you are guaranteed a win on at least one trade.
The unique trading program usually involves two different types of trades. When we first went online we focused on what we called "Long trades" which are now just called Regular trades. These trades use the program's mathematical quotient and basic rules for a trade. There must be at least a 85% probability of success registered by the program.
Our Ultra Conservative trades have been going since the beginning of the Agora Outlook. They were used when actual mailing was the only way to send trades out to people. It was a type of trade that you could place and leave alone no matter what happened in the market. With mail outs it was hard to be able to make any changes to trades so a high probability of success was needed. We canceled our mail out program a few years ago because of the use of e-mail but because the demand was so high for the Ultra Conservative trade program we continued it. It is a very conservative way to trade the market with much lower returns but the trades have even a higher probability of success. With the volatility of the past couple of years these trades haven't even been affected. The program must give a reading of 95% plus accuracy to be able to place a trade. The average return on a trade is anywhere from 5-20% per month. An average year will see a 60%-90% return. We have changed the program a little to adjust to this extra volatility so in time it may turn out to even see higher profits!
S&P 500 E-Mini futures options
The CME developed the S&P 500 futures e-mini contract in 1999 and made it completely electronic to trade. With it came options and very low margin requirements so after we tested it we started the S&P 500 futures Option E-mini trading program selling the E-mini Options outright to mimic our credit spread trades with the new index. This program is very much like the "Ultra Conservative" trade strategy but you just take out the buy side of the trade. To place a trade at these levels we need to see a possible success level of 95% plus. The benefit of this type of trading is that you can make more trades as the premiums go down or trade both the upside and downside at the same time with only one margin requirement! There are so many options out there that expire worthless it's almost a tragedy to miss out on selling them as long as you do it with great safety and use stops.
Copyright c 1996,1997,1998,1999, 2000,2001,2002,2003,2004,2005. All rights reserved. The information contained in the AGORA OUTLOOK NEWSLETTER is based upon data that is believed to be accurate, but is not guaranteed, and subject to change without notice. All projections, forecasts, opinions, and track records cannot be guaranteed to equal our past performance. Persons reading this newsletter are responsible for their actions. Officers and employees of this publication may at times have a position in the securities mentioned, or related services
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