The ETF (Exchange Traded Funds) trading signals were designed for short-term traders who trade QQQ, SPY and DIA stocks. These are generally traders who wish to make no more than 2-3 conservative trades per month. The QQQQ, SPY and DIA signals are generated during market trading hours to satisfy these requirements.

We remind you that options trading is highly risky. Should you decide to trade options based on the ETF signals, we recommend that you observe a few simple rules:

• After a winning options trade, reinvest only the original trade principal, never the principal plus the profit! For instance, if you allocated $1000 to options trading and made a profit of $500 on a previous trade, we strongly advise against reinvesting the full $1500 in your next options trade. Instead, commit only the original $1000. In this way, should you experience a (total) loss due to an option expiring worthless, you will still have the $500 (i.e., your profit from the previous trade);
•  Invest only a small portion of your assets in options - an amount that will suit your personal trading needs and risk tolerance. In our opinion, that amount should make up about 10% of your total portfolio value. It should never exceed 30%;
•  A "Long" signal can be used to purchase call options. When the ETF trading system issues a "Long" signal, it expects the market to move higher. Accordingly, an options trader who has decided to use a generated signal could open a trade by buying QQQ, SPY or DIA call options (calls);
•  A "Short" signal can be used to buy put options. When the trading system issues a "Short" signal, it anticipates that the market will decline. In such a situation, an options trader who follows the signals can open a short trade by purchasing QQQQ, SPY or DIA put options (puts);
•  A "Cash" signal indicates that we should close any open positions;
•  Purchase options with at least 2-3 months left before expiring. Because our signals were developed for short-term trading applications, we might remain in a position for anywhere from one to several days or even a few weeks. Purchasing options that expire within the current month can be very risky. Due to the rapid decay of their time value, options that are close to expiry can expire worthless, even before a signal is closed;
•  Choose the right options strikes. For call options, we recommend selecting the highest strike price that is in the money at the time a trade is initiated. Conversely, for put options, choose the lowest strike price that is in the money when the trade is opened.