Good morning, traders…
Last night, I dipped my toe into the murky waters of the internet to see what traders were talking about.
Reddit, X, StockTwits, Facebook … I lurked them all.
What I saw next didn’t exactly shock me, but it struck me to my core.
Trader after trader, posting about losing 50%, 70%, and even 99% on a single options trade.
I sat there asking myself, “Why are these people doing this to their accounts? The solution is so simple.”
I can’t remember the last time I took a huge loss trading options. And that’s because I never forget to do one thing…
Set a stop loss.
If you’re taking an account-ruining loss on an options trade, there’s no beating around the bush…
You didn’t have a plan.
You didn’t protect your risk.
You didn’t set your stop beforehand.
Let Me Show You How Pressing A Few Buttons Can Save You From Future Losses…
My Early Stop Loss Mistakes
Too loose, too tight, none at all, moving it around in a panic…
Name a stop-loss scenario, and I’ve been there.
Early on in my trading journey, I’d watch trades crumble from a small red blip into a full-blown mess.
I’d stare at the screen, hoping the market would turn and save me.
SPOILER ALERT: It almost never did.
It took me years (and plenty of painful losses) to realize something that I now teach every one of my trading students:
Stop losses aren’t a suggestion, they’re a religion.
Setting a stop on every single trade is non-negotiable if you want to be a consistently profitable options trader.
You don’t set your stop after the trade goes south … you set it when you enter.
The 30% Rule
If your options are down by more than half, it’s because you didn’t set a stop.
That has nothing to do with luck. It’s a choice you made in the heat of the moment (based on emotion rather than process).
In our community, we have a hardline rule: set your stop loss no more than 30% below your entry price.
Buying a call option for $1.00? Your stop loss should be no lower than $0.70.
You might be wondering: Why 30%?
This number has been tested and refined through thousands of trades.
If you’re trading common shares, you can set a pretty tight stop without worrying about it triggering immediately.
But if you’re trading options (especially short-dated calls), you can’t set a stop 5% below your entry.
Why? Because it will likely get triggered before you can even say the words “stop loss.”
30% gives us enough wiggle room for the trade to play out while protecting us from massive, demoralizing losses.
Stop Triggered? That’s a “Discipline Win.
A cleanly triggered stop might result in a real-dollar loss, but it’s a win for your discipline.
It protects your cash and your mindset so you’re ready for the next setup. It instills the importance of stop-losses.
Moreover, it will help you build confidence. If you know the trade can’t lose more than 30%, you should be supremely confident when entering positions.
And in this game, that might be the most important edge of all.
Happy loss stopping,
Ben Sturgill
P.S. All you need is a working phone, internet connection, and a trading account…
And you could begin targeting gains up to 20%… 39%… 100%… 148%… 200%… and even 300%…*
*Past performance does not indicate future results
