High Probability Trading

The decision to take control of your financial future is exciting. You have to make many decisions. Decisions include which strategies to apply, how long and which market you are going to trade.  The single most important decision may be trading style: How the trader will select and execute trades. The two most common methods are discretionary and mechanical. Many […]

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Index Options Settlement Explained

  Traders who sell options for premium have to regard Options Settlement. The process of Options settlement can be somewhat confusing. We will describe the process of Monthly Options settlement. We disregard weekly Options because they expire at the close of every Friday. There is a difference between American style and European style options. There are two baskets, Major Indices […]

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The Importance Of Diversification

Diversification is a technique that reduces risk by allocating investments among various financial instruments, industries and other categories. It aims to maximize return by investing in different areas that would each react differently to the same event. Most investment professionals agree that, although it does not guarantee against loss, diversification is the most important component of reaching long-range financial goals […]

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Know when to take Profits

  When you start with trading, you often will hear a number of pearls of wisdom. Keep your losses small, let your winners run, no one ever went broke taking profits. You can keep your losses small at order entry. It is possible to select defined risk trades and you do not trading too many contracts. It is not a […]

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Options Optimal Position Size

Select the risk you like Option Position Size is important in the risk you take with trading. Especially when you sell options for premium. Depending on your capital in your portfolio your trading style could be different. With much capital you can afford to take on more risk. With a small capital on the other end you want to be very […]

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What causes Option Delta to change

When the option price changes, delta changes. Option Delta is very useful for traders who sell options for premium or for trades who have stocks. Delta is used in many ways. It can indicate the likelihood that the option will finish in-the-money. People whom have stocks may use delta of an option as a hedging instrument. But the delta of […]

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