Where should i trade options
March 4, by The dough Team. As Warren Buffett would say, one of the best things that you can do for yourself is to invest in yourself. For me, this was trading options. I joined after working at an institutional fixed income broker.
This was an extremely valuable experience as it gave me a unique insight into how markets actually worked and how some of the largest fund managers in the world managed their positions. But enough about me. You clicked on this post because you want a question answered: Well, let me tell you why I trade them. Selling index puts, for example, instead of just buying an index fund, or selling calls against an index fund allows me to continually collect time decaywhich is only possible with options, and increases the probability of being profitable.
Take last year for example: That brings up another point: After all, this is your capital and your financial future we are talking about here! And again, you can only do that with options. By actively managing my account, I am able to place trades with my desired probability of profit POPwhich allows where should i trade options to control a portfolio with a where should i trade options POP and where should i trade options me the flexibility to manage winning positions and adjust any trades as needed before expiration.
Even a portfolio with a high POP can still experience a couple trades that end up not doing so well. But who can do that? Instead, I can use options to define my risk. I know my risk at order entry and this allows me to make mechanical decisions about my trades. Check out some additional benefits of defining your risk here.
By trading your own money, you can greatly reduce the costs associated with investing. You can employ simple strategies that will outperform even the best mutual funds. So there you have it. The best way where should i trade options learn is to get some skin in the game. If you need some help, as always, check out dough. Trade an iron butterfly iron fly for short and you might collect a hefty at the money credit, while still keeping the risk defined.
Beginner intermediate Blog Sign Up Login. Control the Probability That brings up another point: Looking at volatility term structure for opportunities to trade put calendar spreads. Break out the metaphorical tape measure, because Ryan and Beef are about to measure some risk. What is an iron fly?