Option Trading Strategies » Stock Options

How To Buy & Sell Stock Options On-line

admin — Sat, 08 Oct 2011 21:07:06 +0000

A revolution has occurred over the past 10 years or so within the brokerage industry. Commissions have fallen dramatically and online trading has made buying and selling securities, especially stock options, quicker and easier. When I was about 10 or 12 years old, I asked a full service broker for a commission schedule. I had already been hit with $100 to $200 commission charges on “market” orders, and I believed it made sense to tailor the number of shares I was buying to the optimum commission threshold. However you’d have thought I asked for the guy’s Social Security Number and bank card number based on the look he gave me. Then his response was something like, “There’s just too many factors affecting the fee … you should just place your order and I’ll try to get you a good rate.” …. What a crock!! Even at age 10, I knew enough to never purchase through that guy again. By the time I graduated from college, I sold everything I had brought through that brokerage firm and never went back.Today, the stock broker’s world has turned upside down. You can trade securities your self on-line for as little as $12, $7, $5, and even totally free (up to a certain number of trades monthly or per year) based on the brokerage firm you pick. Of course, whenever you trade online, there’s nobody second guessing you (yea!!), and you may make mistakes (be careful). In this article, I’m going to discuss the nuances of buying and selling stock options online.When you buy and sell stocks on-line, everything’s fairly easy; just specify whether you wish to buy or sell, the ticker symbol for the stock, whether or not it’s a “market” order (i.e., buy at the current “ask” price or sell at the current “bid” price), and whether or not the order is good today only or until you cancel it.Stock option orders, however, require a little more information. Basically, you must specify: the stock, call or put, strike price, expiration month, and “market” order or “limit” order and premium you want. If you are using a combination of options, it will get a little more complex. I’ll talk about each of these items below. Let’s begin with opening an online trading account …This part is pretty simple. You first choose an online brokerage firm. You can search for articles that assess the totally different brokerage firms based on commissions, quality of customer support, pace of filling orders, quality of user interface, etc. Basically, I recommend you first look for “deep discount” brokers with very low commissions (or even free trades per month or year). You can also go with “discount” brokers if you think you may want more help in placing orders, but you will pay more for every transaction and I doubt you’ll need “help” very long.Three deep discount brokers I’ve worked with include Wells Fargo, ETrade, and Zecco Trading. Wells Fargo offers up to one hundred free stock trades per year, but their on-line software is incapable of making several important, although slightly complicated option trades. For example, you can’t sell naked puts or place spread orders online. Nevertheless, customer support is pretty good. ETrade has good customer support and loads of powerful research features, however they cost a little more and have no free trades (to my knowledge). If you are going to get into serious stock options trading, Zecco Trading is the best I have found when it comes to “ease of placing complicated orders” and getting orders filled. Basic option purchases, selling naked, credit spreads and debit spreads, collars, straddles, and strangles are all simple at Zecco. They even have butterfly and iron condors available although I haven’t used them so far. Plus, you get some number of free trades every month and option trades are only $4.50 plus a few pennies per contract. Zecco customer support is okay.

Options Trading for Dummies – The Very Basics of Options Trading

admin — Mon, 03 Oct 2011 03:58:32 +0000

Options trading for dummies have become a common topic for discussion recently. With the introduction of online options trading, people are getting more and more interested in this mode of investing. While everyday newbies are coming to the business, it is getting increasingly essential for them to get the basic ideas of the trade clear and fast. Because if you cannot get past the basic understanding to the next level of planning really fast, you will be getting behind in the market.

At first, for options trading for dummies, you need to know what a stock option actually is. Simply put, an option is a contract between two parties about a future deal of some stocks at a fixed price. This contract gives one party rights to buy or sell some stocks from the other party at the price fixed in the contract. The holder of the option gets the right for the transaction; meaning if he is going to buy or sell the stocks depends on their decision. On the other hand, the seller of the option, otherwise known as the writer, get the obligation for the transaction, and if the option holder want, they have to buy or sell the stocks as defined in the contract.

Stock options have two types. One is a call option, which gives the holder of the right to buy the stocks. Another is a put option, which gives the holder the right to sell the stocks.

In case of options trading for dummies, you also need to know about the basic elements of an option. They are strike price, option premium and the expiry date. The strike price is the price in which the stocks are sold or bought when option is exercised. It is fixed when the option is written and does not change with the changes of the market price of the stocks over time. A strike price can be: in the money (ITM), which is less than the current security price, at the money (ATM), equal to the stock price, or out of the money (OTM), greater than the underlying security price. Usually, when the option is written, the strike price of one single stock is mentioned. But the options are sold as a bulk of 100 stocks, so the final strike price will be for 100 stocks and 100 times the price written in the contract.

The next important element is the premium of the option. It is the price you pay for the contract. It pays for two things, the contract and the time value of the contract. Premiums can be of two types. One-time payment, paid while buying the option, or monthly premium, paid every month until the expiration of the contract. Option premium is also listed per stock but usually paid for 100 stocks in bulk.

Another important thing to know about is the expiry date. It is the date after which the contract is expired and the stocks cannot be bought or sold at the strike price. Any transaction under the option has to be done before the expiration date mentioned in the option contract. It is usually mentioned in months. In that case, it is the third Saturday of the given month.

The elements described above are enough to get the basic idea of options trading for dummies cleared. Understanding them is very important to understand further information available on options trading. It is very important to clear the concept of them before moving on to more complex concepts like option trading strategies.

How To Buy & Sell Stock Options On-line

admin — Thu, 22 Sep 2011 22:57:33 +0000

Jim Cramer – Trading $$$

admin — Thu, 08 Sep 2011 10:57:41 +0000

Jim Cramer Online Trading, People seem to have grown their interest in online-trading exponentially as compared to past recent years. Learn To Trade Like A Pro CLICK LINK BELOW

CLICK HERE To Trade Like A Pro $$$

With the advancements of technologies and exposure to internet, people are finding it easier to get online and start trading. There are various benefits of getting an online-stock trading account. We will elaborate some of them as below:

These websites help their users by providing them additional services such as online stock trading newsletters. This the one of the best way to keep you updated. These online stock trading newsletters are very helpful for investors as they will get the updated information and trends of the market.

It is highly recommended to subscribe to this service online and get the tips daily from experts and professionals who have prior experiences in the same filed. Online stock market has created a significant place in stock market industry.

Metastock Online Trading $$$

admin — Wed, 07 Sep 2011 22:57:01 +0000

Metastock Online Trading, People seem to have grown their interest in online-trading exponentially as compared to past recent years. Learn To Trade Like A Pro CLICK LINK BELOW

CLICK HERE To Trade Like A Pro $$$

Day Trading Law $$$ Day Trading Law ***

admin — Wed, 07 Sep 2011 10:57:50 +0000

Day Trading Law, People seem to have grown their interest in online-trading exponentially as compared to past recent years. Learn To Trade Like A Pro CLICK LINK BELOW

CLICK HERE To Trade Like A Pro $$$

Cnbc Business News – (Trading Like A Pro) ***

admin — Tue, 06 Sep 2011 22:57:33 +0000

Cnbc Business News, People seem to have grown their interest in online-trading exponentially as compared to past recent years. Learn To Trade Like A Pro CLICK LINK BELOW

CLICK HERE To Trade Like A Pro $$$

Foxbusinessnews.com $$$ Foxbusinessnews.com (Trading Like A Pro) ***

admin — Tue, 06 Sep 2011 10:58:09 +0000

Foxbusinessnews.com, People seem to have grown their interest in online-trading exponentially as compared to past recent years. Learn To Trade Like A Pro CLICK LINK BELOW

CLICK HERE To Trade Like A Pro $$$

Rockwell Trading (Trading Online) Rockwell Trading $$$

admin — Fri, 12 Aug 2011 22:59:18 +0000

Rockwell Trading, People seem to have grown their interest in online-trading exponentially as compared to past recent years. Learn To Trade Like A Pro CLICK LINK BELOW

CLICK HERE To Trade Like A Pro $$$

Stock Options are the most effective Investment pertaining to Novice Investors Learning The way to Build Their Money

admin — Wed, 01 Jun 2011 23:26:48 +0000