Why do people trade in options and lose money ?

This is a discussion on Why do people trade in options and lose money ? within the Futures & Options forums, part of the Markets category; Originally Posted by forker If I am not mistaken, and please correct me if I am wrong because I can't ...

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Old Aug 7, 2012, 8:56am   #49
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Re: Why do people trade in options and lose money ?

angelnish started this thread
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Originally Posted by forker View Post
If I am not mistaken, and please correct me if I am wrong because I can't be @rsed to give much energy on gaining knowledge on it. While this instrument is traded for profit, isn't it mostly used to offset risk in the futures market for buyers of an underlying commodity that are not speculating for profit from trading the instrument.
Yes You are 100% right
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Old Aug 7, 2012, 9:56pm   #50
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Re: Why do people trade in options and lose money ?

They probably focus too much on the underlying and not enough on the vol market.

For example i like 3M AUDUSD vol, implieds at 10 realised at 11 and 1 vol of roll down over 2M seems like good value to me given all the current unknowns with China growth and Europe crisis etc.

Last edited by MacroStyle; Aug 7, 2012 at 10:02pm.
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Old Aug 16, 2012, 7:19am   #51
 
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Re: Why do people trade in options and lose money ?

From my opinion i think every one want to become a rich person or business man. So this thought create greed in their minds. So they spend their money in several trades or other businesses. And some time they loss their money.
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Old Aug 21, 2012, 9:52pm   #52
 
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Re: Why do people trade in options and lose money ?

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From my opinion i think every one want to become a rich person or business man. So this thought create greed in their minds. So they spend their money in several trades or other businesses. And some time they loss their money.


Have you seen this show? If they ever make season 2 I would love to be part of it!
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Old Aug 25, 2012, 12:06am   #53
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Re: Why do people trade in options and lose money ?

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Have you seen this show? If they ever make season 2 I would love to be part of it!
Would you really ?
Why ?
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Old Aug 25, 2012, 2:09am   #54
 
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Re: Why do people trade in options and lose money ?

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Would you really ?
Why ?
Well...just for fun
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Old Aug 25, 2012, 2:59am   #55
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Re: Why do people trade in options and lose money ?

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Well...just for fun
Funny it is not. Look carefully and you will see it is just a cruel joke pretending to be an opportunity. Awful. Sad,
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Old Sep 17, 2012, 4:03am   #56
 
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Re: Why do people trade in options and lose money ?

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Options are like any derivative that move along with the underlying value of a stock / index or whatever. I do not see any difference with any other derivative. The point is that the underlying value is important and that you need to 'play' with the time you got left untill they expire. The fun of the game is that both play a role. When you master this you can find pretty awesome opportunities.

Buying an option that expires the same day can make you a great profit when your trading strategy works. So if you are pretty sure that the market is gonna sell off before the put option is gonna expire, an option that's worth a few cents can go up alot.

And you can have great return on a little investment. When it doesn't go the way you want, you just sell them at the stoploss you have provided yourself before you entered the trade.

You don't need margin for options and if you don't work with a stoploss you can't lose more than the money you put in the trade.

I complete agree with you. I don't see how options is less or more risky than stocks more or less. Especially since options are derivatives of stocks.
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