Ep39 - Liar, Liar, Pants on Fire!

Why Traders Lie to Themselves — and How to Stop

When it comes to covered calls and cash-secured puts, most traders tell themselves comforting half-truths: “I’d be fine owning the stock if it drops.” “I’d be fine selling my shares if they get called away.” But when those scenarios actually happen—when a stock gaps lower or rallies far past a strike—those same traders often panic, blame the market, and forget the plan they swore they’d follow.

In this episode, Dan Passarelli unpacks the psychology behind these lies and how to replace emotional trading with data-driven discipline. Through relatable stories (including a red-light ticket and an ancient Roman twist), Dan shows why even the smartest investors fall into the trap of self-deception—and how to break free from it.

In This Episode

• Why traders say they’re okay with assignment—but secretly aren’t
• How cash-secured puts and covered calls reveal your true comfort with risk
• The real “sweet spot” where these strategies outperform the market
• How to use data and visualization to make smarter, more objective decisions
• What mirror neurons and Michael Jordan can teach you about trading mastery
• How to “outhuman your humanness” by training your brain to respond with logic instead of emotion

Key Takeaway

You can’t control the market—but you can control how you react. When you make trading decisions based on logic and data, not emotion or ego, you gain a consistent edge. Covered calls and cash-secured puts might not make you rich overnight—but they can help you steadily outperform by losing less when others panic.

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Disclosure:

Options involve risk and are not suitable for all investors. Prior to buying or selling an option, investors must read Characteristics and Risks of Standardized Options (ODD) which can be found at https://www.theocc.com/company-information/documents-and-archives/options-disclosure-document

Don’t trade with money you are not prepared to lose. Anything discussed on this show is intended to be generalized information and not intended to be a recommendation to buy or sell any security. The host and guests are not familiar with listeners’ specific situations. For trading information relevant to your specific needs, speak with a licensed broker or advisor.  

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