If you’ve been trading stocks for some time and have never tried options, then you may want to give them a go. Stock options are more speculative but offer flexibility, diversification and control to protect your stock portfolio or create more investment income. So, here are some things you should know about options.

Share This

Of all the important skills in trading, survival is number one. For unless we make it through the inevitable bad times, we won’t be around to capitalize on the good. I’ve laid out some trading account guidelines that specify the account size required to conduct various commodity futures and option trading activities. Stick within these guidelines and you will have an edge on most of the commodity trading public.

$20,000 ACCOUNT
(Risk no more than 5% max ($1000)

Share This

Automatic exercise occurs because in-the-money short positions are not necessarily exercised by buyers; it is more likely that positions will be closed and profits taken. So outstanding in-the-money short positions are automatically exercised by the OCC to absorb the disparity between the two sides.

The decision to avoid exercise is made based on current market value as well as the time remaining until expiration. Many option sellers spend a great deal of time and effort avoiding exercise and trying to also avoid taking losses in open option positions. A skilled options trader can achieve this by exchanging one option for another, and by timing actions to maximize deteriorating time value while still avoiding exercise. As long as options remain out of the money, there is no practical risk of exercise. But once that option goes in the money, sellers have to decide whether to risk exercise with an offsetting transaction.

Share This

Youngsters today are adventurous and seek to be millionaires overnight. This hurry and easy accessibility to stock market has got the numbers increasing on investors in stock trading. Most inexperienced people think that stock trading is a form of gambling that can make them millionaires in seconds. But, for those who are in this business for a long time, understand that it is not a child’s play or magic that can produce money overnight. Like any other business dealings, stock trading also needs time, money and brain to get good returns.

Share This

Robert Kiyosaki made personal financial planning extremely popular amongst common folks. He taught the investment strategy of well-informed investors in real estate and stock option trading in his famous books and audio tapes.

What is option trading?

Stock option trading is tool for creation of wealth as well as protection of wealth. It’s essential that an investor should master stock option trading strategy to make money from bull or bear market otherwise small investor has to struggle with small stock market returns and suffers the devastation of market declines.

What’s the challenge in stock option investing?

Share This