keen to learn about options

locgek

Junior member
14 0
Hi,

Would like to learn about options from a relatively basic base,

Are there any particular websites or online courses that any one can recommend.

Thanks in advance
 

aeromir

Newbie
9 0
Charles Cottle's book is great. OptionParty is right. Paper trade first. When you do start trading live, trade very small until you are profitable. As Dan Sheridan used to say, if you can't trade a $5,000 account, what makes you think you can trade a $50,000 account?
 

locgek

Junior member
14 0
Thanks all, signed up for the CBOE courses!!
 
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locgek

Junior member
14 0
Let me/us know what youre learning or wanting too and how things are going.
Options are fantastic. Good luck with your learning.
Thanks , have completed the beginner modules online with the CBOE- really good I thought, and just really supplemented it with explanations and examples online

Placed a few initial OTM call trades with 30/60 days till expiry, so far all US equities.
1/2 have turned out positive - and I cashed out - with a decent profit , 1/2 are currently massively OTM but the positions are still running.
I have been using Google finance option chain and online option calculator to help guide my choice of strike / expiry.

I want to learn more about these wonderfully named strategies that I keep hearing mentioned - especially the strangle
 

lloydbee

Well-known member
275 17
Sounds good, who's your broker?
When buying singles you're best to buy 1 or 2 strikes ITM, typically these would have a Delta of 60 or so and will increase in value a lot faster than your OTM options. Advice to buy OTM Singles usually comes from people not knowing how to truelly trade.
 

locgek

Junior member
14 0
Sounds good, who's your broker?
When buying singles you're best to buy 1 or 2 strikes ITM, typically these would have a Delta of 60 or so and will increase in value a lot faster than your OTM options. Advice to buy OTM Singles usually comes from people not knowing how to truelly trade.


Hi I am using TD, reason I have been using OTM, was the cheaper entry price, and but I understand your delta point. So far I have only been purchasing at the nearest strike above current stock price. For most of the trades I placed most went ITM within a few days. though some slipped out at the moment.

Hopefully in the coming weeks I will utalising, more of what I am learning. Im still only on a basic level I think
 

aeromir

Newbie
9 0
be careful with OTM long options as you're fighting time decay. A good rule of thumb is the delta is approximately the probability the option will expire in the money. You can subtract that percentage from 100% to get the probability it will expire worthless.

I had a friend who thought Google was going down once. He bought massively OTM puts. Google did go down but not enough and he lost 100% of his trade.

You might try near the money options and even do some vertical spreads. (XYZ at 100, buy the 105 calls and sell the 100 calls for a bullish position).
 
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lloydbee

Well-known member
275 17
Hi I am using TD, reason I have been using OTM, was the cheaper entry price
Buying because they are cheap I can understand, I am sure we all did that at some stage in our trading journey but in reality you are better paying more for the option and definitely ITM, as long as it stays ITM you are guaranteed it having some worth at expiration not that you want to be holding it into that.

Trading in Singles is a dance between the trade going and staying ITM, Time and Price movement. But like you said how you were scalping or closing quickly for profit you will benefit greatly from trading ITM and the same way. (y)

TD/TOS = great choice of broker, I do not think you can get better they are the market leader as far as I am concerned for trading Options.

Once you have a good idea of trading singles and the 4 main Greeks spend some time looking into Verticals... they are a good foundation for trading AND other types of trades.
 

locgek

Junior member
14 0
Buying because they are cheap I can understand, I am sure we all did that at some stage in our trading journey but in reality you are better paying more for the option and definitely ITM, as long as it stays ITM you are guaranteed it having some worth at expiration not that you want to be holding it into that.

Trading in Singles is a dance between the trade going and staying ITM, Time and Price movement. But like you said how you were scalping or closing quickly for profit you will benefit greatly from trading ITM and the same way. (y)

TD/TOS = great choice of broker, I do not think you can get better they are the market leader as far as I am concerned for trading Options.

Once you have a good idea of trading singles and the 4 main Greeks spend some time looking into Verticals... they are a good foundation for trading AND other types of trades.

Thanks for the suggestions, I have taken onboard the suggestions.
I have had placed a combination of single calls and puts some in the ITM, some NTM and pretty much scalping away within the first 30 mins opening bell. Got a number of small positions still open, but hoping in cumulation I should have a good week.

Just finished the basic verticals section on the CBOE course as well!!
 

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