
|
 |
|
 |
Options Tutorial
Options
History - In Europe the options started to attract tulip dealers in early 1600s who wanted
to secure the reasonable price in the future. However, very
soon the options started to attract speculators.
Options Overview -
Options trading has become one of the most popular trading vehicles on the
stock market that gives great leverage without margin requirements.
Why
Options -
Speculation is the main reason why many traders are involved in options
market. This is why the options trading became so popular.
Options Expiration -
Expiration date is the day on which an options contract is no longer
valid and, therefore, ceases to exist.
Options
Types -
There are three main types of options in the financial world: listed options,
unlisted options and employee stock options.
Options Styles - In the
investment world, the options style is determined in relation to the date
the options could be exercised.
Calls and Puts -
An option is the right but not an obligation to convey a piece of property.
The person selling or granting the option is called the options seller and
the person who has the right to execute option is called the options buyer.
Call
Options -
The call options buyer expects the price of the underlying stock to rise in
the future but before the options expiration. On the other hand call options
seller expects the underlying stock to drop in price.
Put
Options -
In opposite to call options, the put options buyer has the right to sell the
underlying assets (stock) to the seller of the put option for a certain
price (the strike price) and before or at a certain time (the expiration
date).
Options Chart - The chart below
summaries the using of the put and call options by different type of
traders.
Option Symbol - Explains how
to read an options symbol.
Exercise and Expiration -
simple example with explanation of the event when an options buyer makes a
decision to exercise the bought options contracts.
Intrinsic and Time Value -
explanation with examples of calculating of options intrinsic and time value
as a part of the premium paid by an options buyer.
In the Money Options -
Out the Money Options -
examples of in the money and out of the money options with explanation of
the trading risk based on the selected options strike.
Options trading
strategy - It is recommended to have developed a trading strategy before
starting to invest into options. A trader has to know how much to invest
into each options trade in order to protect a portfolio from losses and
successfully use selected trading system.
Minimum Invested Amount - This
article explains how to calculate minimum invested amount for any trading
system by following the simple rule that system returns have to cover
expenses at least.
Index Trading
S&P 500
- The main way of investing into the S&P 500 index is to buy stocks of the
companies from the basket of this index. Yet, there are numbers of ways to
invest directly into the index.
S&P 500 Companies -
Here you may see the list of the companies from the S&P 500 basket. The
companies that are included in the index are selected by committee on the
regular basis and this list could be outdated.
DJI -
There are several ways of investing into the Dow Jones Industrial Index
besides buying the stocks from the DJIA basket. One of the most popular ways
of DOW investing is...
Technical Analysis
Technical Studies
- By going deeper into the intraday trading traders start to pay more and
more attention to the technical indicators instead of doing the fundamental
analysis. In general all technical indicators could be divided into four
categories: a) price based indicators; b) volume based; c) breadth
indicators; d) combined studies.
Technical and Fundamental
Analyses - Both fundamental and technical analysis serve the same
purpose to help to define possible future stock trend, yet, at the same time
they are completely different in the way they analyze stocks. Both
fundamental and technical analyses are important and depending on the
trading style one or another could be applied. Before answering on the
question which one to use, let us define a few main points about these types
of stock analysis.
Support
Contact Info -
We welcome any feedback or questions you may have regarding our services or
this Web site.
Disclaimer - If you, the User, do not agree with any part of these Terms of
Use, you must immediately discontinue any use of the Website.
Privacy Statement - We are
committed to protecting your privacy rights and your personal information
|
|

Trading System -
Options Tutorial -
Index Trading -
Technical Analysis -
Glossary - ETFs Disclaimer: All information on this site is intended only for informational and educational purposes and not as a solicitation to do any investment whatsoever, therefore you should not make any decisions based on our signals, our trading system or any other information on this site.
YOU AGREE THAT YOU TRADE SOLELY AT YOUR OWN RISK and investment/trading decisions are solely your
responsibility. None of our Website materials should be interpreted as a recommendation or solicitation to buy or sell any security, or to take any specific action. Any trades executed following the commentaries and Buy/Sell signals on this Website are taken at your own risk for your own account. You agree to assume full responsibility for any and all gains and losses, financial, emotional or otherwise, experienced, suffered or incurred by you.
|