TRADING COURSE – SESSION 6 www.optionstradingiq.com © Copyright 2016. Options Trading IQ. All Rights reserved.

DISCLAIMER Any information contained in this presentation is for educational purposes only. Neither IQ Financial Services, LLC or Gavin McMaster are licensed financial advisors, registered investment advisors, or registered broker dealers. Neither do they provide investment advice, financial advice or make investment recommendations and they are not in the business of transacting trades. Nothing in this communication constitutes a solicitation, recommendation, promotion, endorsement or offer to buy or sell by IQ Financial Services, LLC or Gavin McMaster of any particular security, transaction or investment. Any trades and / or results covered in this presentation may or may not be live trades. All trades and trading results are believed to be accurately presented. However, since the trades may not have been executed in the market, the results may have been under or over compensated for the impact, if any, of certain market factors such as liquidity, slippage and commissions. Therefore there can be no guarantee of accuracy or completeness. No representation is being made that any portfolio will, or is likely to achieve profits or losses similar to those shown. The risk of loss in trading securities and options in particular can be substantial. Customers must consider all relevant risk factors, including their own personal financial circumstances, before making any financial transaction. Options involve risk and are not suitable for all investors. See the Options Disclosure Document: Characteristics and Risks of Standardized Options, available from www.optionstradingiq.com/risks © Copyright 2016. Options Trading IQ. All Rights reserved.

OUTLINE Position Update Potential Condor / Delta Hedging Trading Psychology My Trading – The Good, The Bad and the Ugly 3 © Copyright 2016. Options Trading IQ. All Rights reserved. 3

BEARISH BUTTERFLY P&L +$195 Expiry is approaching. Switch to Sept Could suffer losses if we rally Had to scale / adjust as we get close to expiry 4 © Copyright 2016. Options Trading IQ. All Rights reserved. 4

BEARISH BUTTERFLY 5 © Copyright 2016. Options Trading IQ. All Rights reserved. 5

BEARISH BUTTERFLY 6

IRON TRAPDOOR P&L +$185 Expiry is approaching Could suffer losses if we rally Had to scale / adjust as we get close to expiry 7 © Copyright 2016. Options Trading IQ. All Rights reserved. 7

IRON TRAPDOOR 8 © Copyright 2016. Options Trading IQ. All Rights reserved. 8

IRON TRAPDOOR 9

COMBINED POSITION 10

POTENTIAL CONDOR 11

POTENTIAL CONDOR 12

POTENTIAL CONDOR 13

POTENTIAL CONDOR 14

HOW IMPORTANT IS PSYCHOLOGY 15 © Copyright 2016. Options Trading IQ. All Rights reserved. 15

MENTAL PROBLEMS Addictive Trading Tick Watching Personal Bias Not Keeping Good Records And Reviewing Them 16 © Copyright 2016. Options Trading IQ. All Rights reserved. 16

MENTAL PROBLEMS Trying To Pick Tops And Bottoms Feeling Too Much Excitement Overtrading Rushing In 17 © Copyright 2016. Options Trading IQ. All Rights reserved. 17

MENTAL PROBLEMS The Market Can Move Further And Faster Than You Think Don’t Try To Predict The Market Will Do Whatever It Wants Never Say Never 18 © Copyright 2016. Options Trading IQ. All Rights reserved. 18

KNOW YOUR RISK LIMITS 19 © Copyright 2016. Options Trading IQ. All Rights reserved. 19

EGO IS YOUR WORST ENEMY 20 © Copyright 2016. Options Trading IQ. All Rights reserved. 20

FOCUS 21 © Copyright 2016. Options Trading IQ. All Rights reserved. 21

22 © Copyright 2016. Options Trading IQ. All Rights reserved. 22

BE PROCESSED ORIENTED 23 © Copyright 2016. Options Trading IQ. All Rights reserved. 23

MY TRADING 2011-2016 89% Total Return 49 Positive Months 17 Negative Months. 3 Less Than -0.50% Average Monthly Return 1.35% 24 © Copyright 2016. Options Trading IQ. All Rights reserved. 24

MY TRADING 2011-2016 Best Monthly Return +9.13%. Dec 2012 Worst Monthly Return -8.09%. July 2013 31.82% in 4 months Dec 2012 – Mar 2013 Scaled Back Risk Since July 2013 25 © Copyright 2016. Options Trading IQ. All Rights reserved. 25

THE BAD – GOOG SEPT 2012 Too Stubborn Stock Moved Much Further Than I Thought Possible Couldn’t Continue To Hold While Losses Mounted 26 © Copyright 2016. Options Trading IQ. All Rights reserved. 26

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THE UGLY – NDX JULY 2013 Took On Way Too Much Risk Delta $ Exposure - $350,000 $1,500,000 Vacations 28 © Copyright 2016. Options Trading IQ. All Rights reserved. 28

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AVOID BIG LOSSES AT ALL COSTS We're in the business of making mistakes. Winners make small mistakes, losers make big mistakes 30 © Copyright 2016. Options Trading IQ. All Rights reserved. 30

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