Option trading options made easy
For investors not familiar with options lingo read our beginners options terms and intermediate options terms posts. Using stock you already own or buy new shares , you sell someone else a call option that grants the buyer the right to buy your stock at a specified price.
That limits profit potential. You collect a cash premium that is yours to keep, no matter what else happens. That cash reduces your cost. Thus, if the stock declines in price, you may incur a loss, but you are better off than if you simply owned the shares. Cash-secured naked put writing. Sell a put option on a stock you want to own, choosing a strike price that represents the price you are willing to pay for stock.
You collect a cash premium in return for accepting an obligation to buy stock by paying the strike price. A collar is a covered call position, with the addition of a put. The put acts as an insurance policy and limit losses to a minimal but adjustable amount. The purchase of one call option, and the sale of another.
Or the purchase of one put option, and the sale of another. We trade the stock option instead of trading the stock for leverage purposes. If we have titillated your imagination, twanged a. Two very simple components are commissions and liquidity. Learn more about Option Trading Strategy. Follow our step-by-step guide and learn how to trade options using the various option trading strategies.
One of the most popular of all options strategies are covered calls, a trading technique that can generate rich income streams on a regular basis. Options Trading Made Simple: Online stock option trading success will be greatly improved by using a good stock option trading system or software. Good stock option trading systems use excellent.
Find helpful customer reviews and review ratings for Options Made Easy: Read honest and unbiased product. Even better — following this simple strategy lets YOU determine how much money you …. Discover the world of options, from primary concepts to how options work and why you might use them. Learning how to trade options correctly can be an excellent way to expand your investment portfolio with much less risk and much less money upfront than you.
A zero-cost reverse collar is an excellent long-term strategy in a bear market, because it allows a short position to be maintained and protected for littl. Join LinkedIn today for free. Follow Options Trading Made Easy to get updates, news, and more.