What do you use Stockoptions for

There are a number of reasons an investor would use options. As you may already know, calls can be used if you have a bullish assumption and puts when you are bearish on an underlying stock. However, there are several compelling reasons to add stock options to your portfolio. With ine option you can control 100 shares. An option cost a fraction of […]

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Options Calculate Break Even Price

For a business owner, knowing their breakeven is a really important deal. In basic terms, the breakeven is the point at which the revenue coming in matches the total of all costs going out. Any money received on top of these costs becomes the company’s profit. To illustrate the breakeven, we’ll use a call option. As the definition goes, a call […]

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Option Selling – The Best Business

Warren Buffet states that insurance is the world’s most profitable business. A company sells reams of insurance policies and collects payment for each. A few of those result in claims – which are paid out of premiums collected. The rest is kept as profit. The world’s most profitable business? An option selling business has many similarities. You sell a variety of […]

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Selling Call Options

Selling Call Options is in general not the first trade an investor makes. It is contrary trade of buying calls. A trader that buys a call option expect the underlying to increase in price. Typically a trader select options which have a high Implied Volatility. These options are rich on premium. A trader that is selling call options receives option premium. […]

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Your first Option Trade

What did we consider when we made our first trade? We trade options because they have better odds to realize a profit than with stocks. You have to look for the right  opportunities and have to decide whether we buy or sell options. We also look at other factors as Volume, liquidity, Implied Volatility, and Probability of Profit before we […]

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High Implied Volatility for more Options Profit

Before explaining high Implied volatility we look first what Implied Volatility (IV) is. IV is one of the most important metrics to understand when trading options. Implied volatility is the estimated volatility, of a stocks price. Implied volatility increases while the market is uncertain about the changes in the stock or sector market, about earnings, companies decisions, or if people are bearish. The market is […]

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Benefit from Options Leverage

In this post we will give you an Understanding options leverage and show you how to profit from it. Leverage can be very powerful when it comes to investing because by using leverage it’s possible to turn relatively small amounts of capital into significant profits. With many financial instruments, such as stocks, the only way to take advantage of leverage is […]

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Best way to trade verticals

One of the most commonly used option strategies known as the Vertical Spread. Looking at it from the context of when and why to use, as well as how volatility will influence its setup and payout. We are constantly using Vertical Spreads to act on directional biases while also protecting ourselves against a large move in the opposing direction. More than most of […]

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How do you benefit from Options Delta

Today, we are going to look at the Greek parameter Option Delta. Traders use options Delta in several ways. Learn how to benefit from Option Delta. Delta values can be positive or negative depending on the type of option. The delta for a call option ranges from 0 to 1. When the underlying asset increases in price, call options increase in price. Put […]

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