Saturday, April 23, 2011

Knowing More about Option Trading

They said that one of the effective way of making good profits with small risk is through the nature of option trading. I'm not really sure how the exact process goes but i am really curious and intrigued how much will it help me to become a successful man.
Option trading is something that requires a lot of understanding. They said that option trading is a kind of risk management that really works. Option trading is different from Stock trading. Well, I never experience any of these stock trading stuffs but i heard how risky it could be to some Stock traders. It is like a win or lose game. Some might end up losing their shares or will end up exiting his trade while others are very fortunate to get more profit from it. This only shows that stock trading simply can't guarantee you since Stock market fluctuations will destroy your trade unlike the what so-called option trading which can protect you from any losses and will guarantee you a huge percentage of success rate.
Option strategy provides a limited risk so i am not wondering why most investors are more into option trading because they can earn more profit from it. There are two types of option trading, Put Option and Call option.
Put Options give the option buyer the right the sell the underlying asset while Call Options give the option buyer the right to buy the underlying asset. I'm kind confused with these two but they said that when you buy put option it enables you to profit when the markets fall without having to sell short stock.
How about you guys? What do yah think about Option Trading? Feel free to share your thoughts and let us know. Have a great day and happy blogging!


About This Blog

  © Blogger template 'Ladybird' by 2008

Back to TOP