Options Trading

Options Basics - Nowadays, many investors' portfolios include investments such as mutual funds, stocks and bonds. But the variety of securities you have at your disposal does not end there. Another type of security, called an option, presents a world of opportunity to sophisticated investors.

The NASDAQ Options Trading Guide - Equity options today are hailed as one of the most successful financial products to be introduced in modern times. Options have proven to be superior and prudent investment tools offering you, the investor, flexibility, diversification and control in protecting your portfolio or in generating additional investment income. We hope you'll find this to be a helpful guide for learning how to trade options.

How to Get Started Trading Options - An option is the right to buy or sell an asset at a certain price and by a certain date. Let's say you want to buy a guitar from a friend, and they want $1000 for it. If you don't have the money to buy it right now, you could tell your friend "I'll pay you $300 right now if you'll hold the guitar for me for a month. If I don't come up with the $1000 by then, you keep the $300 and can do whatever you want with the guitar."

How to buy options - Options are often seen as fast-moving, fast-money trades. Certainly options can be aggressive plays; they're volatile, levered and speculative. Options and other derivative securities have made fortunes and ruined them. Options are sharp tools, and you need to know how to use them without abusing them.

Options: The Basics - Pretty much every investor is familiar with the saying, “Buy low and sell high.” The problem is, that strategy only works in bull markets. If you’d like to expand your repertoire of trading strategies and potentially profit from other market trends, options can come in handy. With options, it’s possible to profit whether stocks are going up, down, or sideways. You can use options to cut your losses, protect your gains, and control large chunks of stock with a relatively small cash outlay.