alan-ellmanDr. Alan Ellman, a dentist come professional stock options trader from New York, is the President of The Blue Collar Investor Corp. and has authored three best selling books on the topic of covered call writing, one on put-selling and another student investment guide which is required reading at The University of Maryland. Alan writes financial columns for The Money Show, IVolatility.com, Investing.com and his own award-winning blog. Alan has also presented live seminars for AAII, The Learning Annex and The Money Show and spoken in more than one hundred venues in the past ten years.

In this show Alan shares great insights into:

  • How covered call writing works
  • The websites he uses to screen for “hot” stocks to trade
  • His “sweet spot” to balancing Technical & Fundamental analysis
  • His specific indicators & settings he uses for Technical analysis
  • How he determines an uptrend

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11: Dr Alan Ellman on His Favorite Chart Indicators & How He Finds "Hot" Stocks
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Recommended book

Common Sense on Mutual Funds by John Bogle
Alan Ellman’s Complete Encyclopedia for Covered Call Writing by Alan Ellman

Trading style

Covered Call Writing (Short term Options trading)

Biggest retail trader mistake

No exit plan. I see it all the time. They enter a trade, it turns against them, then I start getting all these emails “What should I do?” It’s human nature.

Interview links

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Transcript highlights

Cam Hawkins:

Tell us more about you personally, and give the listeners more detail about your trading. What you’re trading, how you’re trading it and the kind of results you see?

Dr Alan Ellman:

Well, Cam, I do basically short term options selling. It’s basically two strategies. Covered call writing and selling cash secured puts. I recommend to most new investors to start with covered call writing because it’s a little more intuitive for the average retail investor. So, let me just give you a brief example of how that works. You would first buy a stock. Let’s assume you buy company XYZ at $48 a share. Always 100 shares because 1 options contract consists of 100 underlying shares, so then your investment is $4800. Once you own these shares and you’re in a covered or protected position, you’re now free to sell the option. So let’s assume for a moment that we sell a $50 call option. That means we are selling some unknown person the right but not the obligation to buy our shares from us at $50. Now, my sweet spot and my time frame is 1 month. I’ve tried them all and this is the one where I’ve been the most successful. So, a 1 month option would generate a premium of approximately $1.50 or $150 for the 100 shares. That means you have a return of 3.1% for that 1 month regarding your initial return. Now, if the price of the stock goes from 48 to 50 and your shares are in fact sold at 50. You have now generated an additional $200 which makes your total 1 month return better than 7%. So that gives a general idea of how the strategy works. Of course the risk is in the price of the stock declining below the break even. So if you brought a stock for 48 and sold the call for $1.50, if the price of the stock declines below $46.50 then you can actually start to lose money and that’s where you have to have the skill or position management and exit strategies. Now I’ve been using this strategy since the early 1990’s and my results beat the market every year. There’s not been 1 year since I started using this strategy that I haven’t beaten the S&P500.

Cam Hawkins:

What do you do outside of trading?

Dr Alan Ellman: 

Actually, I collect certifications. My main profession, up until the last 8 years, I’ve been a general dentist. I had an active practice in NY with a partner and four dentists working for me and a staff of 15. And actually started teaching myself how to self-invest in the stock market and in the real estate market; and over the years the Blue Collar Investor has become so big that I had to make a career decision. And as you can see my decision was in the area of finance. So I moved over from being a dentist into being an educator in the area of selling stock options.

As far as my other interests are concerned. I love working out and I love dealing with real estate. So I am a certified personal fitness trainer and certified real estate agent as well. As far as finances goes I have a certification as a Series 65, which is an investment advisor. So, I always felt like, if I got a certification in whatever area I was interested in I would have as much information as I could possibly have. And that was always important to me no matter what area I ended up in. So basically, I work out every day. I check my stocks every day. I write. I’ve had 5 books published.

Cam Hawkins:

Go back in time now and tell us what first attracted you to trading and talk us through that very first trade you took?

Dr Alan Ellman: 

I’d have to say that as growing up as a child, although I didn’t pay much attention to what my parents were doing, they did invest in the stock market. But they did it through a broker. So, I might be sitting watching TV and the phone would ring. The broker would call my parents and would say something like “I think you should buy IBM”. My parents would say “Why?” and he would say “Because I think it’s going to go up.”. So my parents would listen to the broker. They would buy IBM and after that over the next several weeks they’d talk amongst themselves and say “Hey look IBM went up a quarter of a point”, “It went down half a point” and then the next call would come “Sell IBM, buy GM”. I remember thinking to myself “Gee, I wonder how much this broker really cares about my parent’s money?” And they listened to just about everything that he said and my parents were pretty smart and it just kind of didn’t feel right to me. I just kind of felt like, if I did that I would want to have total, total control over the situation. Rather than giving my money to somebody to manage it for me.  So I think that really was in the back of my mind, that in the early 90’s having had a successful dental practice going I made that decision to teach myself how to self-invest in the stock market.

Now, as far as my first trade is concerned I have to be honest, Cam. I don’t remember my first trade buying and selling stocks. But I can definitely tell you about my first trade buying and selling stock options which was a couple of years after I started buying and selling stock. I had self-educated myself. I read books and financial papers and listened to all the show and everything. But I always had a little knack for math so I always had a pen in my hand and I was trying to figure out different formulas to beat the market. And I was buying and selling stocks; beating the market every year. Not to a tremendous extent but maybe by a point or two every year I would outperform the market.

Cam Hawkins:

Were you using a technical based system or was it news based?

 

Dr Alan Ellman:

Well, back in the early 90’s there were two schools of thought in how to invest in stocks. You had the fundamentalists where everything was about earnings and revenues. And the technicians where everything was about reading a price chart. If you would read one book it would say to do it this way and another would say to do it that way. I remember thinking to myself “Hey, wait a second. Why not use both? Why not screen for the strongest stocks fundamentally (for earnings and revenue growth) and then take those stocks and run them through technical screens.

I first screen fundamentally, then I screen using a technical price chart for both trend and momentum and confirming with volume. So, right from the get go, I was beating the market. Then once I started finding out about options and teaching myself options that was like a whole different ball game because back then people were scared to death to use stock options because they considered it way too risky. Let’s face it. People are scared to death to buy stock; then if you throw in the word options you need life medication. So, I was very confident in my stock selection methodology. But now with throwing in options on top of that and I was using a little riskier strategy, actually, initially. So I was very nervous about it. So my first trade, I remember vividly. I put it into my computer and all I had to do was hit the button to execute the trade. I remember my finger getting frozen in mid-air. I was so scared to press that button to execute my first trade. Ultimately I did and the trade went through and I remember thinking to myself, “Well, that wasn’t so bad”. And now, I’m selling between 50 and 100 contracts on between 15 and 25 underlying securities. And then I sell covered calls, also in my mother’s portfolio on ETF’s on a little more conservative strategy.

Cam Hawkins:

Let’s go back to a dark time in your trading career, a point where you hit rock bottom, a trade that kept you awake for a week, an account that you blew in a matter of days or even minutes. We want to hear that story.

Dr Alan Ellman:

Actually, I have that story. It’s archived in my first book. I talk about a stock called Taser. This is a company that makes those stun guns. Back in the 90’s when I was first teaching myself this strategy I was taking a look at the returns I can get from selling these call options and I would see like 3%, “Wow, 3% in a month, pretty good.” And then 4% and 5%. All of a sudden I took a look at Taser and I’m seeing returns of like 9% in one month. The reason for that is, back in the day Taser was testing the effectiveness of these stun guns at various police precincts throughout the US. One test would come back very positivie and the price of the stock would go up a lot. Another test would come back negative and the price of the stock would go down. So there was a lot of applied volatility in the security. And whenever a stock is very volatile the options premiums are much greater. So, Taser was returning 8-9% every month because it was such a volatile stock. So when I saw that I said, “Wow, I gotta go out and get some Taser” So I went out and I brought, Cam, way, way too much Taser for all the wrong reasons. I would say the main reason was greed. It wasn’t a company, like now I’m so structured. I’ll only use companies that have the elite fundamentals, elite technicals. But Taser I brought for the sole reason that it was generating these huge options premiums. So I went out and brought way, way too much Taser and started selling options on it and I was getting these fabulous monthly returns as Taser went down from 36 to 6. So I got killed on Taser. And I learned a lesson. One of the things I talk about in the BCI methodology is to never ever sell a stock on an option you wouldn’t otherwise want to own in your portfolio. And also, if the option premium (the return) is too high. And I have a guideline that I will not ever sell an option if I am getting more than 6% back in one month for an at the money strike. At the money means, an example is that you would buy a stock for 50 and agree to sell for 50. So, if it’s higher than 6%, generally speaking, unless we’re in a raging bull market I will not ever consider that stock an option. So my sweet spot for my initial return is 2-4% a month. So, I learned my lesson and the fact that I learned a lesson and for decades now I haven’t made that mistake again, even though I lost all that money it was a worthwhile loss. It did something for me as a trader.

Cam Hawkins: 

Right, let’s flip this 180 now. Can you talk us through that specific time when everything fell into place. Your big “ah-ha” moment. That point in time you started to become a successful trader – What did you do differently? Who did you learn from? That sort of story…

Dr Alan Ellman:

I was buying and selling stock using the combination of fundamental and technical analysis for a couple of years and again beating the market. So I would say from that perspective I feel like I was doing well right from the get go. But one day I was reading an article on self-directed IRA accounts and here in the US the government is pretty fussy about what it will let you trade in sheltered accounts. It can’t be anything too risky. And part of the article said you’re allowed to sell stock options in a self-directed IRA account and I go “Wait a second, how’s that possible? Options are risky. They’re for people looking to hit a grand slam home run.” And they named the strategy Covered Call Writing. So I said “Let me research this out” So I went out and found some books on covered call writing and I started reading them. And somehow it just kind of lined up with me. It made sense when I started reading books on how this strategy works.  I understood why the government considered this strategy low risk enough to allow it in sheltered accounts. So I said, “Let me give this a shot”. So, I started to write these formulas down for how to use this strategy. I practiced for maybe 4-5 months and then opened an account for covered call writing. I did hire a broker for the only time in my life because it involved options and I was a little nervous about it. So I hired a broker for about 3 months. Every single thing that broker told me to do I disagreed with. So after 3 months I said, “What’s the point in having a broker if I’m not going to follow what he’s telling me to do?” So I ended that and started an online account and once I started that I was beating the market, but then I started beating the market by a lot more. So, I would have to say if you’re looking for an “ah ha” moment it was when I first read that article regarding sheltered accounts. Nowadays covered call writing and put writing represents about 90% of my portfolio.

Cam Hawkins:

Ok. Here’s the last question in this round. What’s been your proudest “moment” since you became a successful trader?

Dr Alan Ellman: 

If I could give you two. The first one that stands out in my mind, being a maths/science guy all my life, then having people find out about what I was doing and all of a sudden I was writing books, doing seminars and everything. My first book was called “Cashing in on Covered Calls”. At the time I wrote that I didn’t even know if I could write a book. I knew I was pretty good at math and science, but I didn’t know if I could write a book, but I did and I based that book on various seminars that I was doing when people started asking me how I’m doing this. This woman Barbara Carns who owned a real estate club on Long Island in New York, had a small publishing company. So she asked me if she could publish the book. I didn’t think much of it. But my proudest moment was when I received a phone call from her, 3 months after publication of the book and she told me my book had gone to No. 1 on Amazon.com on the topic of Covered Call Writing. Since then I’ve published 4 more books and my books have held that No. 1 spot for now 8 years.

The other thing I wanted to mention was, we have members from 87 counties outside the US, following the BCI methodology and many of them are kind enough to send me emails and testimonials. How using the strategy has helped them change their lives financially, made a difference in their retirements. I don’t know if the word is proud, but it makes me feel that what I’m doing is worthwhile.

Cam Hawkins:

How long did it take you to go from trading newbie to consistently profitable trader?

Dr Alan Ellman:

I was profitable right from the get go, but to be an expert, probably 5 years.

Cam Hawkins: 

What’s your mental approach to trading and what special techniques do you use to keep your emotions in check?

Dr Alan Ellman:

You have to have a strategy that you have 100% confidence in which I do with my strategy. Because I’m made every mistake in the book and corrected it. So I know this system works. So, I’d say, you have your rules and your guidelines and you stick with them. So, it’s no emotional investing. You must have a system that you have 100% confidence in.

Cam Hawkins: 

What’s your win loss ratio?

Dr Alan Ellman:

Let me answer it this way. If you had 20 positions and I would say 12 of them are going to be winners, 4 of them are break even and 4 losers. But here’s the thing Cam. Using those position management techniques I talked about before, your winning positions can be enhanced. I have strategies where you can make more than the maximum return as crazy as that sounds. It’s in my material. Also, the losing positions, you have ways of mitigating the losses.

Cam Hawkins: 

Do you have a success quote you can share; one that resonates with you personally?

Dr Alan Ellman:

Can I give you 3 Cam? The one I’m most known for is “Be CEO of your own money”. Take charge, take control. Another one is “Education is power and leads to confident investing”. That’s really the key, because everything is so intimidating when you first start learning it. I was so scared when it came to Options and now I’m doing dozens and dozens of trades in a matter of an hour. And finally “No one cares more about your money than you do”. So even if you’re not going to use this strategy or even any other strategy, if you’re going to turn your money over to somebody, you should really educate yourself so at the very least you can evaluate what they’re doing for you is the right thing and the money you’re paying them is put to good use.

Cam Hawkins: 

What’s your recommended “must read” trading book?

Dr Alan Ellman:

Let me give you a non Ellman book and give you an Ellman book for Covered Call writing. One of the books I found so helpful learning how things work in the stock market was “Common Sense on Mutual Funds” by John Boggle, the founder and chairman of the Vanguard Group. As far as Covered Call writing. I feel the best book I’ve written is “The Complete Encyclopaedia for Covered Call Writing”. That took me 4 years to write, it’s over 500 pages and everything in the book, all the charts and graphs, are in colour so I make the educational process very easy.

Cam Hawkins: 

What are your views on automated trading systems, e.g. trading robots?

Dr Alan Ellman:

I don’t like it. I think that screening is great. When you’re screening stocks from a fundamental perspective, I think it saves so much time. I use a lot of Investor’s Business Daily screens for that reason. Some people may lean on these trading robots as an excuse to not educate themselves. I really, really believe that retail investors should understand how all this works. How to evaluate stocks from a fundamental and technical perspective and, of course, position management.

Cam Hawkins: 

What trading related internet resource, like bloomberg.com, do you always use?

Dr Alan Ellman:

I mentioned before I use Investor’s Business Daily screens. Two of them are very important to me. One is the IBD50 which is published in their Monday edition which you can actually buy on Saturday, also online. Those are basically growth companies that have very, very strong price charts. I’ve had huge success writing options on the IBD50 over the years. They have another screen called the Smart Select screen. You have to be a member of IBD to get access to it. What they do is screen stocks from a technical and fundamental perspective. So there are 6 categories in these screens and they rank them with numbers and letters, which could be a bit of a hassle going through that. But adjacent to those numbers and letters they have what is called the checklist. The checklist has 6 circles next to each of the 6 categories. If the circle is coloured in green that means it’s an elite performer in that category, if it’s coloured in yellow, it’s in the middle and if it’s coloured in red, it’s an underperformer. So when I screen stocks for purposes of options selling, all 6 of those categories must be filled in in green. So that means they are the elite performers for both the stock and the industry both from a fundamental and technical perspective. Let me shoot you one more wonderful site for screening, that’s finviz.com. It’s a screener and it’s also great for stock news as well and it’s free.

Cam Hawkins: 

How do you go about screening on FinViz?

Dr Alan Ellman:

Actually, my 4th book which I called Stock Investing for Students, I put in all the fundamental parameters and technical parameters for longer term investing, not for short term options selling. I use different parameters for that. There are drop downs by each category; you could feed in the parameters, like for example you may want a PE ratio of under 3. All those parameters, you’ll feed them in and you’ll get stocks that meet those parameters. You can also, to some extent do Technical Analysis with that screen as well. For example, you want a stock trading above its 50 day Simple Moving Average. There are a lot of different categories, technical, fundamental and other things like you may want to weed out certain stocks that have very low average trading volume. So, you have a lot of flexibility with that FinViz screen.

Cam Hawkins: 

What your preferred trading strategy?

Dr Alan Ellman:

Covered call writing, short term options selling. Which is covered call writing and selling cash secured puts. I would recommend to those of your listeners who are going to do short term options selling to start with covered call writing because it’s a little more intuitive. You know, the price of the stock goes up, the value of the option goes up. Put selling is a little different, they’re inversely related. Although selling puts is considered to some to be exactly the same as covered call writing. I think it’s a little more bearish strategy and I show in my material how to incorporate both into one strategy that I call the PCP (Put Call Put) where you first sell a put to buy a stock at a discount and then once you own the stock then write the covered call. So, then the strategy keeps going and then each month you’re either generating cash from the sale of the option or you’re buying a stock at a discount if you sold an out of the money cash secured put. So, this can sound very intimidating but, like driving a car, once you learn it and paper trade and practice trade this is not rocket science. I’m not smarter than anybody else out there I’ve just been doing this a lot longer.

Cam Hawkins:

How much of you strategy is based on working out if the stock will go up or down versus the actual options strategy?

Dr Alan Ellman:

I focus like a laser on the strategy itself, but if you go back to what I discussed with you before, Cam, how we’re selecting the underlying security. We’re going to do a fundamental analysis. Elite performers. These are the kind of stock the institutional investors love. I’m talking about mutual funds, hedge funds, banks and insurance companies. They love stocks with strong fundamentals. That’s why that’s step 1 in the screening process. Then you go to technical analysis. So I mentioned before, trend and momentum. Well for short term options selling we want to see an uptrend, we want to see strong upward momentum which also implies institutional support. So whether you’re selling call options or selling put options, you want those stocks to be going up or at the very least, you’ll still make a lot of money, they just stay the same. What you don’t want are stocks that are going to go down a lot. So, my watch list (before I even take a look at how much cash I can generate on the sale of that option) consists only of stocks that have the strongest fundamentals and the strongest technical along with the third screen I use which I call common sense principles where I avoid things like earnings reports, profit diversification, asset allocation and so on. So, to answer your question, Cam, before I even sell and option the only stocks I’m selecting from are stocks that are more likely to be successful going up in value than down in value. So I factor that in as part of the screening process.

Cam Hawkins: 

If you could leave our listeners with one piece of advice what would it be?

Dr Alan Ellman:

Do not invest even one penny of your hard earned money until you have educated yourself in all 3 aspects of the strategy. Entering the trade, managing the trade and exiting the trade. Do not learn how to enter a trade, and now it’s going against you and you’re like a deer in headlights. What do I do now? I must check Ellman’s book. No, you must master all aspects of the strategy. And if the trade turns against you be able to react in a non-emotional way and know, hey listen, if the price of the stock goes down I know the option value will go down. Once it hit’s 20% of the amount that I generated from the sale of that option I’m going to buy back that option. It’s automatic, you can even set a limit order to do it so you don’t even have to be in front of your computer. So, the short answer is education. You must educate yourself and then you will have the confidence and you will never be intimidated by another options trade again.

Cam Hawkins:

What’s the biggest mistake most retail traders make?

Dr Alan Ellman:

No exit plan. I see it all the time. They enter a trade, it turns against them, then I start getting all these emails “What should I do?”. It’s human nature.

Or even a plan to enhance gains. So if you made 4% but you missed out on an opportunity to make 7 % that month, you may feel pretty good about the trade but you didn’t really maximise it.

Cam Hawkins: 

What does your typical trading day look like?

Dr Alan Ellman:

Well, I get up early. Starting from my days in the dental practice. I get up about 6am and take a look at the futures to get an idea of how the market is going to open. Of course, that doesn’t dictate what it’s going to be doing during the day. I spend about an hour on my computer taking a look at emails I got overnight from members. Then I head to the gym and spend about an hour and a half working out. Then I come home and check my portfolio’s. I check them maybe 3-4 times a day, I don’t have to spend a lot of time doing it. If I feel I have to set a limit order because the price of the stock is declining. I can do that and shut my computer and do something else. And, so, my typical trading day is maybe 15 minutes worth of work; but when the new contracts are starting and the old ones are ending that expiration Friday and the following Monday or Tuesday, I do put in a couple of hours’ worth of work. And during the rest of the month, maybe another hour. So, in total, maybe 3-4 hours a month, but that’s partly because in my company I have a team that produces these reports on stocks and ETF’s that are eligible for options selling and I use to do that myself before my company grew to the size it is. Back then it use to take me maybe 6-7 hours a month.

Cam Hawkins:

We’d like you to help us find a high probability entry point for our trading system. We already have a market to focus on (namely the S&P500), and we’re looking for specific standard indicators, candlestick formations, market events, those sorts of things… So Thomas, to help us pinpoint high probability setups for our trading system what “3 golden nuggets” can you share with us today?

Dr Alan Ellman:

Let me premise this answer by first saying, when you’re selling short term options you can tailor that strategy to almost any market situation. Like I told you before, the in the money strikes in a bear market, you could do very, very well. You can also sell options on inverse ETF’s which go up when the market goes down. But that said, I base my bullish assessment on a 6 month chart of the S&P500. I like to see the 50 day Simple Moving Average above the 200 day moving average, both in an uptrend. I also take a look at the VIX, CBOE volatility index. Some people call it the investor fear gauge. I like to see that below 20 or stable. I also read all the weekly economic reports. Some people may feel that’s a little boring, but if you go to my blog site, I summarize these every week for my members. So I develop my bullish or bearish sentiment based on those 3 parameters – the chart of the S&P500, the VIX and the tone of the weekly economic reports. Then I take that and put it together with the chart technicals (bullish, bearish, consolidating), my personal risk tolerance. And that will dictate the type of trade that I’ll take. More bullish and I’ll take an aggressive covered call writing position. If I’m more bearish I’ll take a more conservative in the money strike I’ll use a stock with a lower implied volatility and so on and so forth. So, your trades can be tailored to your overall market assessment. What I’m saying here is that if the market is not bullish it doesn’t mean you can’t participate in covered call writing or short term option selling. Now as far as the stock is concerned, I take a look at… ah… my time frame is 30 days. So I take a look at the trend. I use exponential moving averages. I’m going to throw a couple of terms at you here Cam. I hope it’s okay. I’m going to tell you the momentum indicators that I use. Those of your listeners that are not familiar with reading a price chart, this may not make any sense, but I’m happy to share this information. I use the MACD histogram and the Stochastic Oscillator as momentum indicators. I’ve had huge success using these indicators in indicating whether I should take an aggressive or more conservative approach in options selling.  And I confirm everything with Volume. So, all this information will dictate which stocks I select (more volatile, less volatile) and which options to select, out of the money which is more aggressive or in the money which is more conservative. So everything plays a role in my ultimate investment decision.

Cam Hawkins: 

What specific things are you looking for with regard to the MacD and Stochastic indicators?

Dr Alan Ellman:

Generally speaking, the MACD Histogram is the MACD subtracting the 9 day Exponential Moving Average from the MACD. So you get a quicker movement in the MACD Histogram. It’s basically, it’ll look like a bar chart when you look at it on a chart and you want that to be above zero because that shows positive momentum. What I look for is for it to not only be above zero but to also be ascending. So each bar higher than the previous bar. So if the bars are above zero but descending. I consider that a mixed MACD picture. If the bars are below zero I consider that a bearish MACD signal. Now, there is no one signal that will dictate how I will evaluate a price chart. I paint the mosaic and take all 4 parameters and then I say, within 3 seconds, I can take a price chart and tell if it’s bullish, mixed or negative. If it’s negative I won’t even consider it. If it’s mixed I may consider it but I’m going to take a less aggressive stance as to which option I’m going to select. I’ll go more in the money than out of the money. And with the Stochastic Oscillator I also want to see that ascending. I don’t care if it’s in over brought. I’ve seen Stochastic Oscillator over brought for months and months and we’re only taking a 1 month position here. So a really bullish position if it’s ascending after having broken through the 20th percentile, and super bullish would be having double projection above the 20th percentile and ascending. So, you know, there are various degrees of bullishness and bearishness, so dropping below the 80th percentile and descending is a bearish signal. Double dip below 80 is super bearish. Basically, you’re just looking to see if something is going up or going down. The average investor should be able to take these 4 parameters and investigate a chart in under 3 seconds.

Cam Hawkins: 

What typical time frame are you looking at?

Dr Alan Ellman:

I usually take a 6 month to a 1 year time frame. I use 20 day and 100 day exponential moving averages. My MACD I use 12 and 26 day with a 9 day Exponential Moving Average and Stochastic Oscillator I use a 14 day.

Cam Hawkins: 

Before we wrap up what’s the best way for traders to get hold of you?

Dr Alan Ellman:

Facebook.com/TheBlueCollarInvestor. My Twitter handle I’m told is @TheBCInvestor. My website TheBlueCollarInvetor.com. You folks can email me direct at Alan  at TheBlueCollarInvetor.com.

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HYPOTHETICAL PERFORMANCE RESULTS HAVE MANY INHERENT LIMITATIONS, SOME OF WHICH ARE DESCRIBED BELOW. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFITS OR LOSSES SIMILAR TO THOSE SHOWN. IN FACT, THERE ARE FREQUENTLY SHARP DIFFERENCES BETWEEN HYPOTHETICAL PERFORMANCE RESULTS AND THE ACTUAL RESULTS SUBSEQUENTLY ACHIEVED BY ANY PARTICULAR TRADING PROGRAM.

ONE OF THE LIMITATIONS OF HYPOTHETICAL PERFORMANCE RESULTS IS THAT THEY ARE GENERALLY PREPARED WITH THE BENEFIT OF HINDSIGHT. IN ADDITION, HYPOTHETICAL TRADING DOES NOT INVOLVE FINANCIAL RISK, AND NO HYPOTHETICAL TRADING RECORD CAN COMPLETELY ACCOUNT FOR THE IMPACT OF FINANCIAL RISK IN ACTUAL TRADING. FOR EXAMPLE, THE ABILITY TO WITHSTAND LOSSES, OR TO ADHERE TO A PARTICULAR TRADING PROGRAM IN SPITE OF TRADING LOSSES, ARE MATERIAL POINTS WHICH CAN ALSO ADVERSELY AFFECT ACTUAL TRADING RESULTS. THERE ARE NUMEROUS OTHER FACTORS RELATED TO THE MARKETS IN GENERAL, OR TO THE IMPLEMENTATION OF ANY SPECIFIC TRADING PROGRAM, WHICH CANNOT BE FULLY ACCOUNTED FOR IN THE PREPARATION OF HYPOTHETICAL PERFORMANCE RESULTS AND ALL OF WHICH CAN ADVERSELY AFFECT ACTUAL TRADING RESULTS.

At all times any and all information on, or product purchased from, this website, is for educational purposes only and is under no circumstance intended to provide financial advice. No guarantee is represented from any statements about profits or income, whether express or implied. As no trading system is guaranteed, your actual trading may result in losses. You will at all times accept the full responsibilities for all of your actions, including, but not limited to, trades, profit or loss. You agree to hold 52traders.com, Ziba Online Limited, the site's legal owners, AT and any authorized distributors of this information at all times harmless in any and all ways. By using our product(s) this constitutes your acceptance of our user agreement.

You agree by using this site, and related sites of ours and any of our material content you may receive either from such site or in any other form and that, accepting our terms and conditions of purchase that you agree that you, and you alone, must ensure that the use of any of the materials purchased from our site in any manner or form at all, is in compliance with your national, local, federal, state or county laws.

CFTC - U.S. Government Required Disclaimer:

Forex, futures and options trading have large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to invest in the futures and options markets. Don't trade with money you can't afford to lose. Our website, product contents, and materials are neither a solicitation nor an offer to Buy/Sell futures or options. No representation is being made that any account will or is likely to achieve profits or losses similar to those discussed on our website or in any materials. The past performance of any trading system or methodology is not necessarily indicative of future results. Substantial risk is involved. Forex trading has large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to invest in the Forex markets.

Don't trade with money you can't afford to lose. Nothing in our course or any materials or website(s) shall be deemed a solicitation or an offer to Buy/sell futures and/or options. No representation is being made that any account will or is likely to achieve profits or losses similar to those discussed on our site. Also, the past performance of any trading methodology is not necessarily indicative of futures results. Trading involves high risks and you can lose a lot of money.

CFTC RULE 4.41 – HYPOTHETICAL OR SIMULATED PERFORMANCE RESULTS HAVE CERTAIN LIMITATIONS. UNLIKE AN ACTUAL PERFORMANCE RECORD, SIMULATED RESULTS DO NOT REPRESENT ACTUAL TRADING. ALSO, SINCE THE TRADES HAVE NOT BEEN EXECUTED, THE RESULTS MAY HAVE UNDER-OR-OVER COMPENSATED FOR THE IMPACT, IF ANY, OF CERTAIN MARKET FACTORS, SUCH AS LACK OF LIQUIDITY. SIMULATED TRADING PROGRAMS IN GENERAL ARE ALSO SUBJECT TO THE FACT THAT THEY ARE DESIGNED WITH THE BENEFIT OF HINDSIGHT. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFIT OR LOSSES SIMILAR TO THOSE SHOWN.