Sign inRecent Commentaries tagged (for-rookies)
My Story and Risk Management
I repeatedly write about the importance of risk management when trading options. Believe me when I tell you that I understand how much most of you are tired of reading about it. How can I know that? Because I've been in your shoes.I firmly believe that if you don't pay much attention to what...
Learning to Trade Options
In your attempt to search the Internet, looking for ideas on how to successfully begin trading options, you landed here. You are in the right place. Here are some tips on how to get started. Some may seem obvious, but the purpose of this post is to save the options rookie from unnecessary...
Avoiding Early Assignment
This video states that 'it costs you nothing' to short stock. Be aware that some brokers charge a fee when you hold a short stock position - and if the stock is difficult to borrow, the fee can be very stiff.
Q & A. Trading Options: Exercise and Assignment
Via email: "Would like more on the perils of assignment."One of the recurring topics I encounter is anew option trader's concern about being assigned an exercise notice on some option he/she has sold.There are situations in which being assigned results in an unhappy ending, but they are few are...
My Philosophy of Trading
Part I.There's More to Trading Than the Mechanics Any investor can buy or sell options.The position can be hedged with stock or other options.You choose a position to own, enter the order (at a limit price), and become the proud owner of that position (obviously, only if that limit order is...
Dividend Risk When Trading Options
In options terminology, 'dividend risk' refers to the chances of not collecting the dividend when you have written a covered call. If you own stock and want to collect the dividend, and if you also want to write covered calls that are slightly in the money, then you may encounter dividend...
Why Trade Options: Profits and Risk Reduction
Are you an investor who has not yet learned about the risk-reducing properties of options and how adopting conservative strategies can preserve the value of your portfolio?If not, that's a shame because if you had been using a very conservative option strategy - collars - to protect the value...
Exercising an Option
Important note: There is one major misconception that is fairly common among option rookies. It leads to a great deal of confusion and I want to be certain that it never happens to you. This discussion is important enough to justify its own blog entry. ·The owner of an option has certain...
What Is An Option?
I love trading options. My goal is to interest you in using options to make your investing more enjoyable, more profitable, and less risky. I’m not trying to sell newsletter subscriptions or encourage you to buy costly software. This blog is for options education and discussion. If want to know...
Can You Make Money With Options?
In a forum I frequent, I recently came across this innocent sounding question: "Can anyone make money consistently when trading options?" I don't know if the poster was thinking about learning to trade options and wanted an opinion as to his prospects, or whether he's been unsuccessful and wants...
Emotional Diversification
I can always count on Dr. Brett Steenbarger, trading coach, trader, blogger and psychologist to come up with interesting commentary. "Emotional diversification: the degree to which the happiness and contentment in your life are coming from multiple sources. When we are emotionally diversified,...
Options Education: Use Your Time Efficiently
I've been reading a variety of blogs and have come across some interesting ideas that are applicable to my world - that of an options investor/trader. One such post (a guest post, written by Ramit) warns readers that most people waste too much time by focusing on items that may seem to be...
Before You Make Your First Options trade
It's understandable that you are anxious about using options.Maybe a friend told you how much money he/she has made with options, making you anxious to get started.Or perhaps, the term 'options' makes you anxious because of some horror stories you may have heard. The truth is that options are...
Choosing an Appropriate Option Strategy
Introduction to option trading Your goal is to make money when using options and to do that, you must make some trades.The trades cannot be made randomly, and obviously, some thought must be given to which specific options to buy and/or sell. That's where choosing a specific option strategy...
Options Education For Rookies; The Purpose of This Blog
One of my problems when writing this blog is deciding whether topics that I've discussed, in detail, months ago should be repeated.Most of you have not been with me since the beginning (last June) and may benefit from such repetition.Going forward I plan to use some previously posted material...
