There are Other Options

By TheWild1 at 12 August, 2008, 3:36 pm, Categories : Financial Markets

Thanks to the amazing services of INO, I am able to share with you guys this great video released by Options University on how powerful option trading really is.

Options According to Investopedia

Options are extremely versatile securities that can be used in many different ways. Traders use options to speculate, which is a relatively risky practice, while hedgers use options to reduce the risk of holding an asset.

In terms of speculation, option buyers and writers have conflicting views regarding the outlook on the performance of an underlying security.

For example, because the option writer will need to provide the underlying shares in the event that the stock’s market price will exceed the strike, an option writer that sells a call option believes that the underlying stock’s price will drop relative to the option’s strike price during the life of the option, as that is how he or she will reap maximum profit.

This is exactly the opposite outlook of the option buyer. The buyer believes that the underlying stock will rise, because if this happens, the buyer will be able to acquire the stock for a lower price and then sell it for a profit.

What is Covered on the Video

Why options were designed to be the “Perfect Hedge” against anything and everything else going on in the stock market (with the proper use of options, you can PERFECTLY HEDGE your portfolio against market volatility… both on the upside and the downside…)
The many “virtues” of options trading (yes, that’s right… options trading is not “evil” or “dangerous” as the clueless mainstream financial media portray… far from it, when used the ‘right’ way…)
How you could have used the advantages of options in this currently vicious and volatile market to completely protect your portfolio (you could have even scored some tidy “windfall returns” from playing the precipitous drop in the financial stocks recently, here’s how…)
The unusual “jack hammer” analogy of using options in trading (Both very are powerful tools, but can be dangerous when used improperly or by someone who doesn’t know how to use them…)

It is only free for a limited time, so check it out while you can.

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