Options Made Easy

What are you doing today to become financially secure for the future?


Why Trade Stock Options?

As we have seen in the past, companies with a stock price of $100 per share can decline to $50 or even $0.  If you had purchased the option for $5 per share what would you have lost?  The worst case scenario is $5 per share as opposed to $100. 


Also, remember in stocks your losses are dollar for dollar, but the option is whatever the Delta is for that option. Delta is a number that measures how much the theoretical value of an option will change if the underlying stock moves up or down by a dollar ($1.00).

 

With stock options, the potential profits are much higher.  I have seen  on many occasions when a 5% movement in the stock that the option would increase as much as 100%.


We also can profit when stocks decline without selling short.  So we don't care which direction the market trades; we can be profitable.


A declining market is my favorite because it moves so quickly.  This means larger profits to us.


Smiling all the way to the bank!