January 28, 2025 | Read Online

Don Kafuman here.

Before I dive into the nitty-gritty of trading smarter (not harder), let's take a quick look at what's happening in the markets today.

It's been a wild ride, hasn't it?

After yesterday's Nvidia-led AI rout, U.S. stocks are bouncing back.

The Nasdaq is up and trying to claw its way out of a 3.5% drop, while Nvidia itself is making an impressive rebound after shedding almost $600 billion in market value on Monday—the biggest one-day drop in U.S. history.

Ouch!

The chaos was sparked by DeepSeek, a Chinese AI startup that's shaking up the market with its open-source AI model built on a shoestring budget.

It's got Big Tech scrambling to justify sky-high valuations, and traders are riding the waves as tech stocks try to find their footing.

Meanwhile, all eyes are on corporate earnings and the Fed's rate decision this week.

It's safe to say volatility is alive and well, and that's exactly why beginner traders need a smart, steady plan.

If you're new to options trading, this kind of market action can feel overwhelming.

But don't worry—I'm here to help you navigate these choppy waters. Today, we're talking about longer-duration, high-probability options trades, a strategy designed to keep you out of trouble and, more importantly, keep you in the game.

Why Most Beginner Traders Fail (And How You Won't Be One of Them)

Let's face it—beginner traders love excitement. They chase the adrenaline rush of fast-paced trades, looking for quick, massive gains. But here's the truth: that excitement is a one-way ticket to blowing up your account.

Most new traders dive into short-term options, like weekly contracts or even zero-days-to-expiration (0DTE) trades. And while these trades might seem like easy money, they're more like a ticking time bomb.

The biggest killer?

Time decay, also known as Theta. Options lose value as they approach expiration, and short-term options lose value the fastest. Even if you're right about the stock's direction, the relentless march of time can erode your profits—or worse, turn your trade into a loss.

This is why so many rookies end up yelling at their screens, "Why does this keep happening to me!?"

The solution? Slow down. Trade smarter.

The Secret Sauce: Longer-Duration Options

If you're new to options trading, longer-duration options are your best friend. They give you time to be right, reduce the impact of time decay, and help you avoid the stress of short-term market noise.

Here's why this works:

Lower Time Decay (Theta):
Short-term options lose value quickly, but longer-dated options (think 50-60 days out) decay much more slowly. This gives you more room for the trade to work in your favor.
Reduced Stress:
Trading doesn't have to feel like a heart attack. Longer-dated options let you focus on the bigger picture instead of panicking over every tick in the market.

Think of it this way: would you rather sprint through a minefield or take a calm, calculated walk on a paved road? Trading longer-duration options is like walking the paved road.

Why This is a Strategy (Not Just a Directional Bet)

This approach isn't just about guessing the direction of the market—it's about stacking the odds in your favor, minimizing risk, and giving yourself the time and tools to succeed. Here's why it qualifies as a strategy:

1. Focus on High-Probability Trades (The Role of Delta)

What Makes It Strategic:
By focusing on options with a 60-65 delta, you're not betting on a moonshot, like buying an out-of-the-money (OTM) option with a low delta (e.g., 10-20). Instead, you're choosing options that have a higher probability of success because they are slightly in the money (ITM).
- ITM options have intrinsic value, which means they are less dependent on the stock making a huge move to generate a profit.
- The higher delta ensures the option's price moves more predictably with the underlying stock, reducing the risk of losing your entire investment due to time decay or market noise.
How It's Different From Gambling:
Instead of a "Hail Mary" trade, you're betting on a high-probability scenario where the odds are tilted in your favor. This is a calculated and conservative approach, not a reckless gamble.

2. Choosing Longer-Duration Options (Minimizing Time Decay)

What Makes It Strategic:
Time decay (Theta) is one of the biggest enemies of options traders. By choosing options with 50-60 days until expiration, you minimize the impact of time decay compared to short-term options like weeklies.
- This gives the stock or ETF more time to move in your favor, reducing the pressure to "nail the timing perfectly."
- It also lets you focus on the broader trend or setup, rather than worrying about short-term fluctuations.
How It's Different From Gambling:
Instead of trying to predict what will happen in the next day or two (a game of chance), you're giving yourself time to be right. This reduces the stress and emotional decision-making that often leads to losses for beginners.

3. Risk Management (Small, Manageable Trades)

What Makes It Strategic:
By focusing on lower-priced ETFs or stocks and keeping trades affordable (e.g., $250 per contract), you're implementing risk management from the start.
- This ensures that even if the trade doesn't work out, the loss is small and manageable.
- It also allows you to stay in the game longer, giving you more opportunities to learn and refine your skills.

4. Repeatable Process (Not Random)

What Makes It Strategic:
This approach is based on a repeatable framework:
1. Identify a stock or ETF with a clear trend or setup.
2. Choose a high-delta option with a longer expiration.
3. Use a limit order to control your entry price.
4. Manage your risk by keeping position sizes small.
Because this process is methodical and consistent, it allows you to learn from your trades, refine your approach, and build confidence over time.
How It's Different From Gambling:
Gambling is random—there's no framework or process to improve your odds. This strategy is structured and focused on learning and improving.

But Isn't It Still Directional?

Yes, this strategy is directional—you're buying a call if you think the stock will go up or a put if you think it will go down. However, being directional isn't inherently bad, as long as you're doing it in a controlled, high-probability way.

What separates this from reckless directional betting is:

Probability: You're using high-delta, ITM options to increase your chances of success.
Time: You're giving yourself enough time to be right by choosing longer expirations.
Risk Management: You're keeping trades small and manageable, ensuring no single loss can take you out of the game.

How This Sets You Up for Future Strategies

This beginner-friendly approach isn't the endgame—it's a stepping stone. By starting with longer-duration, high-probability trades, you're learning critical skills that will prepare you for more advanced strategies like:

Vertical Spreads: To limit risk even further.
Iron Condors: For non-directional strategies.
Theta-Based Trades: To capitalize on time decay once you understand it better.

The goal is to build a strong foundation. Once you've mastered this approach, you'll be ready to explore more complex strategies that don't rely solely on direction.

And if you feel like you're ready now, make sure to join me for my upcoming 12-week mastermind.

Start Slow, Trade Smart

With markets as volatile as they are, it's tempting to chase quick wins. But if you want to be in this game for the long haul, you've got to start with the basics.

Focus on longer-duration options, stick to high-probability trades, and keep your risk small. Over time, you'll build the skills and confidence to tackle more advanced strategies.

Remember: trading is a marathon, not a sprint. Take it slow, stay disciplined, and keep learning.

To your success,

Don Kaufman

🎯 Forget Luck—Discover the Proven Earnings Season Pattern Behind Triple-Digit Winners

Monday's market chaos—where the tech sector lost $1 trillion—has set the stage for what could be one of the most volatile earnings seasons in years.

The sell-off, triggered by DeepSeek, a disruptive Chinese AI startup, has shaken the markets—but for smart traders, this volatility brings incredible opportunities.

And tomorrow, META, MSFT, and TSLA report earnings, which could be the next big catalyst. Are you ready?

While most traders are caught off guard by these wild swings, a small group is quietly locking in triple-digit profits—using a repeatable pattern that shows up like clockwork during earnings season.

We're talking:

348% in 2 days on AMZN
182% in 2 days on AAPL
169% in 2 days on MSFT
225% in 1 day on TSM
190% in 1 day on UNH
122% in 2 days on AAL

These aren't hypothetical numbers. They're real trades made by traders who know how to take advantage of earnings season volatility.

Now, it's your turn.

Join Don Kaufman LIVE tomorrow at 12 PM ET for an exclusive session where he'll show you exactly how to identify and execute these trades—just in time for the biggest earnings reports of the season.

Here's what you'll learn:

📊 Why earnings option premiums create a short but powerful "profit window"
🎯 How to spot the predictable pattern that shows up 24 hours before a big move
💡 A step-by-step plan to confidently execute your next earnings trade

With reports from META, MSFT, and TSLA dropping tomorrow, the opportunities are knocking.

Don't miss your chance to trade smarter this earnings season.

🔵 RSVP Now and Secure Your Spot for Tomorrow's Live Event!