Selling Options the most Profitable Way
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 […]
Read moreAs trader you want to find options which are most expensive options to sell. Why? Because you like to sell expensive and buy it back when they are cheaper. You will make more money when the options have higher option premium. Why would premium selling be more beneficial for option traders at this market? Well, given that we have had […]
Read moreSelling Options Premium is the most important concept for trading options. You can choose what probability of profit you want. Beginning options traders often begin with just purchasing calls or puts. After some time they discover that the price of the option is influenced by more factors than the movement of the underlying. Every single option trade has a buyer […]
Read moreTraders sell calls and puts depending of their assumption. They will receive option premium upfront by selling options. In this yield-seeking environment, selling options is a strategy designed to generate current income. We sell options with high implied volatility. We want the option to expire worthless or we buy them back when they are much cheaper. If you the options […]
Read more
Sell volatility: Fade the news It’s no secret to most option sellers that higher volatility means higher premiums. How do you get more option premium? Traders fear Volatile markets. It makes them uncertain that they will make money. Therefore the price of the option goes up. This situation creates more opportunities for the option sellers. I do not suggest you […]
Read moreCredit Spread is very popular with traders. This strategy is also used by trader insiders. It is really simple and effective. It is explained in almost every at options trading seminar. Seminars people paid thousands of dollars to attend. Just like you, we are always looking for an easier, faster way to success and financial freedom. I would much rather […]
Read morePassive Trading is done by people who want to create an extra income. A passive trader is often interested in investing their money, but they do not want studying financial statements, markets, and even weather reports. This type of investor laughs at the good luck mantras and charms used by some investors. They are often happy to put their money in the hands […]
Read moreBinary Options are like regular options in that they allow you to make a bet as to the future price of a stock. However, binary options are different in that if the “strike price” is met by the expiration date, the binary option has a fixed payoff of $100 per contract. It doesn’t matter if the stock price is a […]
Read moreCompanies who needs money to expand their business can go to the bank for a loan or issue Stock Options. Stock Options have two similar but slightly distinct meanings in everyday use. The first use is in the sense of employee stock options. And the second use is that stock options are traded on an exchange. An employee stock option […]
Read moreFor traders it is important to know how to trade Volatility. What is it and how can you use it? When the stock moves up and down Volatility increases. While uncertainty increases the option premium increases. This change of the stock option premium always is exaggerated. And the experienced trader knows that the the price will have a mean reversion. Why […]
Read moreMost options are traded within 90 Days to Expiration. LEAP Options are just like regular monthly options except that they have a long time to expire. LEAP options are options with DTE of more than 1 year from today. LEAP stands for Long-term Equity Anticipation Security. Investors will pay a lot of money for options with much days to expiration. […]
Read moreThe stock markets have created exchanges that trade Stock Options. These stock options come in two types. There are call options, which are the right to buy shares of a stock at a certain price by a certain date. And there are put options, which are the right to sell shares of a stock at a certain price by a […]
Read moreWhat is Triple Witching and when does it occur in Trading? We are not talking about Macbeth here. There is no shortage of tricks and spells. Not to mention toil and trouble if you trade indexes and stocks and do not understand it. Options expire every weak, month or quarterly. Triple Witching is different. At TW a lot of weekly. […]
Read morePeople that sell options have to deal with option exercise risk. When you have sold options that are in the money some one can decide to use his right. You have better chances of making profit when you sell options than rather buying. With selling options you receive option premium. The buyer has only a limited time to exercise his […]
Read moreHave you ever wondered how the rich got their wealth and then kept it growing? Do you dream of retiring early or of being able to retire at all? Do you know that you should invest, but don’t know where to start? If you answered “yes” to any of the above questions, you’ve come to the right place. On this […]
Read more