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Presented by Daniel Toriola There are tools to help anyone interested in creating wealth in the stock market. Whether you are currently active in the stock market or just starting out, there is an easy-to-follow guide that shows, step by step, how to turn round an investment Click here to know more Not All Web Hosts Are The Same. Some Are Really Responsive To Customers. Backed By a 30 Day No Questions Asked 100% Money Back Guarantee, 99.9% Uptime Guarantee. Read What Our Clients Say About Us! Click here to know more Covered Calls - Trading Options To Lower Your Risk By Robert Hauver "Are you, nuts?! You want me to risk part of my savings trading options? This whole covered calls idea sounds like just another one of those crazy options strategies that sound great, but don't deliver in the end." My pal was a normally a mild-mannered sort - very contemplative, always weighing the consequences rationally before acting. In short, a logical thinker. Imagine my dismay when that one phrase, "trading options", triggered this unprecedented tirade. You'd think that I'd insulted his family or maybe something worse. After a few moments had passed, I realized the reason for my friend's outburst. He, like so many other investors, had only lost money trading options. Why? Because he'd never discovered the number one option trading secret: 3 out of 4 options expire worthless. You read that correctly, when you trade options as a buyer, you have a 25% chance of making money, and a 75% chance of losing money. This is why professional traders and investors favor the option strategy of selling options, rather than buying them, in hopes that the trade will go their way. "Wait a minute. How can all of those options just expire worthless? I've seen ads for 100's of option strategies and trading systems on the internet. They can't all be losing money." I had to smirk. Now I really had him thinking. He knew that I hadn't yet told him the big "secret behind the secret", but he couldn't quite put his finger on it. "I have one word for you, my doubting friend", I said,..."Time". "When you become an option seller, you have time working FOR you, instead of against you. The reason is simple - as puts and calls get closer to their expiration date, they keep losing their time value, due to "time decay", or theta, the Greek letter that option traders use to denote the % of change in time value of an option." This is true of any option, no matter if you're buying or selling call options or put options, or using a Alzheimer's Disease Dementia E-book of compiled reports on risk prevention, early detection,delay the start of symptoms, new treatment options.For age 50+ Page 1 Presented by Daniel Toriola covered call strategy. It's one of the big secrets of options investing that doesn't get written about too often. Because of the power of time decay, you can actually guess wrong about the direction of the market, or a stock, and you'll still make money selling a call option or put option, as opposed to the buyers on the other side of the trade, who not only have to guess the stock's future price movement correctly, but must do it BEFORE the option expiration date. This helps to explain why even conservative investors use the covered call strategy, which is widely considered one of the most conservative option trading strategies around. To sell covered calls, you must own at least 100 shares of the underlying equity, since each call contract corresponds to 100 shares of the underlying stock. This is a tool you can use to hedge your portfolio, and lower your risk, by receiving "call premium" money, which lowers your break-even cost basis. Selling covered calls is a short-to-mid-term option strategy you can use to double and triple your yields on new stock purchases, and/or to earn more income from your existing portfolio. Want to make money selling Covered Calls? Visit this blog: http://hubpages.com/hub/CoveredCall to see an option table explained, a glossary of option terms you need to know, and a step-by-step actual trade example of how to sell covered calls. Author: Robert Hauver Statistical Methods Of Stock Trading Low risk short-term stock trading strategies. Page 2 Presented by Daniel Toriola Options Trading and Risk By Jason Ng Is options trading risky? This is one of the most popular questions that options trading beginners ask. In fact, my clients ask me this same question all the time. I would then ask them “What do you mean by risky?”. The usual answer would be “Can I lose a lot of money in options trading?”. At least this brings us somewhere. Asking if options trading is risky without a clear idea what risk is in the first place gets nobody anywhere. Risk is defined in many different ways to different people and for most people, risk is simply an expression of their fear of losing money. Whenever I am asked by an options trading beginner if options is risky, I know what they are really telling me is that they don’t want to lose money. How can we address this “risk” then? Even though there are many ways to define risk in the financial sense, I think my 2 parts explanation caters best to the needs of the common retail investor. In my 2 parts explanation, risk in options trading for common retail investors are made up of; 1, Probability of Loss. 2, Consequence of Loss. It’s like crossing a street. The probability of death is small but the consequence of death is catastrophic. However, because the probability is so small, we continue to do it every day. In stock trading, you cannot really control the probability of loss because you win only if the stock goes up. That is why stock traders reduce the consequence of loss by having sensible stop loss in place. See how the probability of risk and the consequence of risk interact with each other now? The good news about Options Trading is that you get to control both the probability of risk and the consequence of risk! If you can control both elements of risk, won’t options trading actually be less risky than stock trading? Options trading reduces the probability of risk through options strategies that profit from more than one direction. In fact, there are options strategies that profit when the stock goes up, down and sideways all at once! When you can profit in so many different directions all at once, won’t your probability of risk be dramatically reduced? An example of such an options strategy is the Call Ratio Spread which makes a profit if the stock goes up to a certain limit, stay stagnant or go down endlessly. Options trading (http://www.optiontradingpedia.com) reduces the consequence of risk through leverage. Leverage cuts both ways. If you abuse leverage and buy options like you buy stocks, then you are in big trouble. However, if you use only money you can afford to lose in each options trade and make use of its leverage to produce the same returns that you would if you have bought the stocks instead, won’t the consequence of risk always be within your acceptable limit? An example of this is the Fiduciary Call options trading strategy. Since the probability of risk and the consequence of risk can be dramatically lower in options trading than in stock trading, is options trading still “risky”? Options Demystified Use These Options book and Abundantly Increase Your Money, Your Knowledge, and Your Life - GUARANTEED. Page 3 Presented by Daniel Toriola Risk can be defined in many ways and options trading is inherently risky due to its nature as a leveraged derivative instrument. However, with sensible control of the probability and consequence of risk, your options trading experience may be a lot less “risky” than you think. Options trading becomes “risky” when you lose control over these 2 critical elements. Jason Ng is the Founder and Chief Option Strategist of Masters 'O' Equity Asset Management ( http://www.mastersoequity.com) and author of http://www.optiontradingpedia.com. He is a fund manager specializing in options trading and his revolutionary Star Trading System has helped thousands. Turn $200 Into $4,630 In 30 Days! Earn money by providing stock research and trading options from your home PC. Step by Step course from a Professional Trader. Page 4 Presented by Daniel Toriola Related eBooks: Options Trading and Risk There Is No Free Lunch Are Futures Riskier Than Options Popular Option Trading Strategies: Profit in bull and bear market directions Textbook Options Strategies Or Real Options Strategies Get more Free PDF eBooks at FreePDFeBooks.com Related Products: How to Buy a Car Without Getting Ripped Off! Photo Re-Sizer Blogging Made Easy Name Branding Syndicator 101 tips to stay fit and live longer. Malamaal.com: A genuine resource center for Quality Ebooks and Softwares This PDF eBook is for free Distribution only, it cannot be SOLD Rv Internet Access Guide Information to help RVers who need Internet access while on the road. Click here to know more Powered By FreePDFeBooks.com ReBrand this PDF eBook with your Name / URL / ClickBank Affiliate ID for Free Commodity Option Secrets Learn to trade options like a pro, using Delta Neutral, Calendar Spreads, Option Scale Trading and other Option Secrets. Page 5
