By Chris Johnson and Jon Lewis
Get FREE options trades each week! Flexibility and Versatility
Trading options is a great way to make money in volatile markets like we’re experiencing now. Options have fantastic versatility, and you can make a profit on a stock or index whether it’s going up or down. With options, you can profit on a stock moving up or down by paying a fraction of the cost of owning that stock outright.
If you want to protect a larger part of your portfolio from a downside disaster, you can do it. Whether you want to bet on a stock soaring or sinking, or whether you want to turbocharge your returns on stocks you already own, look no further than the options markets to make your financial dreams come true.
By Chris Johnson and Jon Lewis
Get FREE options trades each week! You Can Profit by Correctly Anticipating the Market
You can profit from correctly anticipating a rising or falling market. You may be familiar with equity (stock) options, but the availability of index options and Exchange-Traded Fund (ETF) options allow you to make money whether a stock, sector or the market as a whole makes a move. These ETFs and index options trade like stocks and are available through any online or full-service broker.
Don’t miss out on the next OptionsZone Insider Alert!
By Chris Johnson and Jon Lewis
Get FREE options trades each week! Make Money in a Sideways, Non-Trending Market
While options traders make some of their biggest returns when the markets are volatile and making dramatic moves, you can use options to liven up even the most boring market conditions.
How? By becoming an option seller, where you collect premium (cash) upfront on the next business day. (The transaction would be a “sell to open.”) You can sell options against stocks you already own, or sell them against options you hold long (that you “buy to open”) in your trading account.
By Chris Johnson and Jon Lewis
Get FREE options trades each week! Profit From the Passing of Time
It’s a fact: Time is the enemy of the option buyer. You can hold a stock in your account forever (as long as the company is still around and isn’t taken out by bankruptcy or a merger), but time starts ticking on options from the moment you enter a position, as they come with an expiration date.
It’s a fact: Time is the enemy of the option buyer. You can hold a stock in your account forever (as long as the company is still around and isn’t taken out by bankruptcy or a merger), but time starts ticking on options from the moment you enter a position, as they come with an expiration date.
However, you can hop over to the other side and become an option “writer” (seller) and profit from the passing of time!
By Chris Johnson and Jon Lewis
Get FREE options trades each week! Gain Leverage and Financial Muscle
With options, you can control tens of thousands of dollars’ worth of stock for literally pennies on the dollar. Each option contract controls 100 shares, so you’re not exposing a large amount of money, and in return you can’t lose a large amount of money.
Options can cost anywhere from as low as a few cents, to as expensive as a share of stock. But remember, you’re only paying a fraction of what the stock is actually worth, to control the same-size position as someone who actually owns the shares!
By Chris Johnson and Jon Lewis
Get FREE options trades each week! Using Leverage Means Minimal Capital Outlay
This is where the magic of leverage comes in, allowing you to participate with only a minimal capital outlay. Whether you want to buy call options to play a stock to the upside, or buy put options to profit from a falling stock, the most you can lose is what you spend to buy into the trade.
In fact, with the puny cost of options compared to owning the stock outright, you can control the stock with a comparatively small amount of money and keep the rest of your stash in cash, where it earns interest!
By Chris Johnson and Jon Lewis
Get FREE options trades each week! More Selective Trading
With options, you can tailor-make strategies, with their own risk/reward scenarios, before you ever step a foot into play. Knowing your risk before you enter the trade is a HUGE advantage over most other traders out there.
You might have a substantial amount of money in stocks that you plan to hold for a significant amount of time – maybe some blue chip names that have been around forever that are doing well and are achieving stable or even incremental gains. But in the meantime, wouldn’t you love to make some fast gains on stocks you already hold long?
Or, maybe you want to dabble in some names that you’d like to have in your portfolio – some new, up-and-coming “hot” stocks that have great upside potential, but you’re not ready to invest the serious dollars that go along with stock ownership.
No problem, because option trading is not only a great way to get into the names you want for a short while, but when a trade’s going your way, you have the option to buy that stock at an agreed-upon price during the life of your contract.
Think about the possibilities that being a little more creative in your investing can bring!
Don’t miss out on the next OptionsZone Insider Alert!
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