Bear spread in which a put with a higher striking price is purchased and one with a lower striking price is sold, both options having the same expiration date. This spread is sometimes more broadly categorized as a "vertical spread": a family of spreads involving options of the same stock, same expiration month, but different strike prices. They can be created with either all … [Read more...]
Why Are Stock Options Important?
Stock options offer investors limited downside in pursuing speculative trading strategies. Stock options also offer the ability to hedge existing positions and to minimize risk. Stock options are important in many advanced trading activities. Investors can make money as both a call writer or a call seller depending on market conditions. Stock options enjoy great leverage with a … [Read more...]
Options Trading System
Options trading systems are strategic methods developed to make online trading easy and tackling the problems involved in option trading. These are the tools involving set of rules that option traders are to follow and manage their trading activities in more convenient and confident manner.While installing an options trading system, several aspects have to be kept in mind. … [Read more...]
Steps to keep in mind while buying call option and put option.
Following are the steps that should be kept in mind while buying call option and put option: Research the online brokerage services specialized in option trading (e.g. OptionXpress)- compare option trading fees and services Open an option trading account with the brokerage service you choose Transfer funds to your brokerage option account Learn the details about … [Read more...]
Kinds of options in trading
Call Option It is an option to buy a stock at a specific price on or before a certain date. Buying a call option gives you the right (but not the obligation) to purchase 100 shares of a company's stock at a certain price (called the strike price) from the date of purchase until the third Friday of a specific month (called the expiration date).In this way, Call options are like … [Read more...]