By knowing what does in the money mean, we can find out why did we make more on the futures contract than we would have by just buying a call? The reason is that until an option gets deep in the money, it will not increase in value as quickly as a futures contract. It has to do with the Delta [...]
Let’s move into What is a Bearish Market! Hopefully by now you are starting to see how to trade options to be part of your overall trading plan. There are really just three things to think about right now; being bullish, being bearish and trading a flat market with options.
Let’s now take a look[...]
Time to cover the definition of a bullish market. As we discussed, there are only two kinds of options, Puts & Calls. In the most simplistic form, you want to buy a Call option when you feel the price is going up and you want to buy a Put option when you think the market is going down. We are [...]
There are many options trading mistakes that people get stuck into their mind just because the onset sounds logical. There are many of the options trading mistakes out there, but we need to cover at least a few of them before we begin.
I’m going to teach you how to trade options for a living but [...]
We talked about how time is money options traders earlier but the longer an option has (number of days) until it expires the more it will cost. This is logical because in the previous example with an option to buy a house, if the seller had given you a two-year option to buy the house he would want [...]
In Options Trading Explained we’re going to help get your started in setting up your business. I’ve always said that trading is a business and if you don’t treat it as a business you are destined for the poor house. Now obviously, I don’t know if you have ever had your own business or not [...]
So you want to know where to start in options trading to make more money? That’s great but how do you learn to trade options? Firstly, an option is an agreement with someone that gives you the right, but not the obligation to buy or sell something at a specific price on or before a specific date[...]
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* Testimonials are not a guarantee of future success. All information is for educational use only and is not investment advice. Trading financial instruments, including Stocks, Futures, Forex or Options on margin, carries a high level of risk and is not suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to invest in any of these financial instruments you should carefully consider your investment objectives, level of experience, and risk appetite. Only risk capital should be used for trading and only those with sufficient risk capital should consider trading. The possibility exists that you could sustain losses exceeding your initial investment. You should be aware of all the risks associated with trading and seek advice from an independent financial adviser if you have any doubts. Past performance, whether actual or hypothetical, is not necessarily indicative of future results. All depictions of trades whether by video or image are for illustrative purposes only and not a recommendation to buy or sell any particular financial instrument and do not factor in trading costs in trading examples due to varying commission and fees among traders. The impact on market prices due to seasonal, market cycles or news events may already be reflected in the price. See full risk disclosure. See full risk disclosure.