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How To Trade Stock Options (Ultimate Beginners Guide)

Discussion in 'Investing/Trading/Cryptocurrency/Altcoins' started by jpmartin, Dec 14, 2015.

  1. jpmartin
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    jpmartin Jedi Master I've Read UNSCRIPTED

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  2. MJ DeMarco
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    MJ DeMarco Raving Lunatic Staff Member Read Millionaire Fastlane I've Read UNSCRIPTED FASTLANE INSIDER Speedway Pass LEGENDARY CONTRIBUTOR Summit Attendee

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    Admin Post
    Another great resource for the absolute beginner is Step Up to Options...

    https://www.dough.com/stock-options-explained

    I will expand on this at a later date/post (And @IceCreamKid as well) but options are truly the one financial investment that fits a Fastlane modality. At some point on your financial journey, you should learn the right way to trade them. And yes, there is a right way, and a wrong way.
     
  3. jpmartin
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    jpmartin Jedi Master I've Read UNSCRIPTED

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    Without an ounce of doubt!!! btw, that article also leads you to dough.com - excellent resource, that has another advantage of getting you approved for options trading with ThinkOrSwim / TD Ameritrade.
     
  4. IceCreamKid
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    IceCreamKid With Great Power Comes Great Electricity Bill Read Millionaire Fastlane FASTLANE INSIDER Speedway Pass LEGENDARY CONTRIBUTOR

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    Very excited to be sharing some knowledge and experiences on this topic in the future. I've been dying to share some of this stuff with people who are actually interested.
     
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  5. jpmartin
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    jpmartin Jedi Master I've Read UNSCRIPTED

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    We're all ears!
     
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  6. jpmartin
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    jpmartin Jedi Master I've Read UNSCRIPTED

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    MJ, would be really great to read your post on this, particularly how it ties with the CENTS = Control, Entry, Need, Time, Scale framework. (sorry, had to twist that around).
     
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  7. MJ DeMarco
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    MJ DeMarco Raving Lunatic Staff Member Read Millionaire Fastlane I've Read UNSCRIPTED FASTLANE INSIDER Speedway Pass LEGENDARY CONTRIBUTOR Summit Attendee

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    Admin Post
    I promise I will be making a huge post on it in the near future. Just gathering some more trench experience and waiting for the year to end.

    Also, the post will NOT be outside for public consumption-- it will be made on the INSIDE. I got a good suspicion that @IceCreamKid will be a legendary contributor to it as well. Stay tuned!
     
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  8. Daniel A
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    Daniel A DIESEL Read Millionaire Fastlane Speedway Pass

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    I'm seriously looking forward to this! The 3-day Rich Dad event I went to long ago was about stock options and regrettably my interest in that died off, but now it's been reignited! I was just signing up for dough.com, but it said the email was taken. I knew it seemed familiar because I'd already made an account. This is another reason to get INSIDERS once again...

    Ditto on my bolded text above. ^
     
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  9. AllenCrawley
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    AllenCrawley Legendary Contributor Staff Member Read Millionaire Fastlane I've Read UNSCRIPTED FASTLANE INSIDER Speedway Pass LEGENDARY CONTRIBUTOR Summit Attendee

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    It's been 15 years since I actively traded stock options. I really enjoyed it. Looking forward to this as I'm sure it will be a great refresher and I bet I'll learn a ton as well.
     
  10. exclusives88
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    exclusives88 Silver Contributor FASTLANE INSIDER Speedway Pass Summit Attendee

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    I also look forward to this.

    I traded options in 2013 and 2014. I was super risky, trading calls/puts or straddles on earning days where premiums were crazy high due to its volatility. Let's say that I lost a lot of money! I'd like to learn as how I was investing was the WRONG way!
     
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  11. Chitown
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    Chitown Silver Contributor Read Millionaire Fastlane FASTLANE INSIDER Speedway Pass Summit Attendee

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  12. jpmartin
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    jpmartin Jedi Master I've Read UNSCRIPTED

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    Chicago is where it all began...!
     
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    Chitown Silver Contributor Read Millionaire Fastlane FASTLANE INSIDER Speedway Pass Summit Attendee

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    @MJ DeMarco,

    Bookmarked! Those videos look tight. Looking forward to what you and @IceCreamKid are cooking up. Thanks, fellas!
     
    Last edited by a moderator: May 6, 2018
  14. Chitown
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    Chitown Silver Contributor Read Millionaire Fastlane FASTLANE INSIDER Speedway Pass Summit Attendee

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    For about 7 months in 2005 I was a runner and out trade clerk for R.J. O'Brien, one of the founding market makers of the Merc in 1914, I believe. It was called the Butter and Egg Exchange, then. I left one week before that nasty Refco scandal in late '05.

    Glad I got the hell out when I did. Doing out trades would have been a frickin' nightmare!
     
  15. Kevind88
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    I've been studying options trading. I've read a few books and Sheldon Natenberg's book is my favourite. I watched videos from tastytrade site, however, I am a little skeptical about their trading strategies and risk management techniques. I am looking for other learning sources, your recommendation would be greatly appreciated.
     
  16. jpmartin
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    jpmartin Jedi Master I've Read UNSCRIPTED

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    Try going through the link given...
     
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  17. IceCreamKid
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    IceCreamKid With Great Power Comes Great Electricity Bill Read Millionaire Fastlane FASTLANE INSIDER Speedway Pass LEGENDARY CONTRIBUTOR

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    I can tell you from experience that reading another book will not give you the feeling of confidence which you seek. It will just lead you down the rabbit hole of analysis paralysis.

    For me, the biggest confidence booster has been:
    1. trading in real-time
    2. using the ThinkBack feature in ThinkorSwim to allow me to manually backtest my strategies.

    I invite you to test the strategies that you learned from TastyTrade using the ThinkBack feature. I think you'll be pleasantly surprised at how effective their strategies are. A consistent 20-40% profit per year is very realistic utilizing their strategies.

    Also make sure to test your strategy in a variety of market types. It's important to learn when to use the proper cashflow strategy.
    • Clear trending markets=directional trading(delta trading)
    • Choppy markets=time decay trading(theta trading)
    • Volatile markets=volatility trading(vega trading)
    Historically, the market goes sideways the majority of the time so ideally you will be selling theta and profiting from time decay. Stay away from covered calls. Not enough control in those and when things get ugly, they get UGLY.

    Sign up for a free account at https://www.dough.com/#traders and observe their trades in real-time. You'll learn a lot about how to adjust trades to profitability in the event that the market moves against you.
     
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  18. Kevind88
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    Thanks for the advice. I was paper trading using ThinkorSwim but didn't know about the Thinkback feature. Will definitely test it out.
     
  19. Kevind88
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    Any updates on your options post MJ?:)
     
  20. Captain Jack
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    Captain Jack Silver Contributor Read Millionaire Fastlane I've Read UNSCRIPTED Speedway Pass

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    There are MANY MANY updates on this. Purchase an Insider subscription for further details.

    Seriously. There are multiple very active threads that will tell you everything you need to know to successfully trade options.
     
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  21. MJ DeMarco
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    MJ DeMarco Raving Lunatic Staff Member Read Millionaire Fastlane I've Read UNSCRIPTED FASTLANE INSIDER Speedway Pass LEGENDARY CONTRIBUTOR Summit Attendee

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    Yes, I made an extensive thread on the INSIDE, which I plan to update for awhile. That thread also morphed 3 other threads on the inside. All contain contributions from myself and @IceCreamKid who alluded in several threads that he also trades options.
     
  22. Kevind88
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    Will do, thanks MJ!
     
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  23. Kevind88
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    Thanks MJ, will join Fastlane Insider today:)
     
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  24. jpmartin
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    jpmartin Jedi Master I've Read UNSCRIPTED

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    Did I miss this?
     
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  25. MJ DeMarco
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    MJ DeMarco Raving Lunatic Staff Member Read Millionaire Fastlane I've Read UNSCRIPTED FASTLANE INSIDER Speedway Pass LEGENDARY CONTRIBUTOR Summit Attendee

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    I tagged you in the INSIDER thread ... it's called "How to Print Money Like the Worlds' Billionaires."
     
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