Hello! I sold my house and have over $100k cash. (I will probably post back here in 3 months crying that I lost all my money haphazardly gambling Options) Besides lurking here for months, what other research do you recommend I do? I bought "Options for Beginners" just to lay the basic groundwork. I'm receiving the CD from Options888 for additional training. As well, any brokerage recommendations you have for Canadian residents that will probably be dealing strictly with Options would be appreciated! Ideally, I would like to make $1000/month on the $100k. Is this realistically attainable? Thanks everyone!
1) Yes, 1% per month is attainable and realistic, but it's not a gimmie. 2) Are you certain you want to put all that cash into the options market? Don't you feel you will buy another house at some point? 3) Please don't begin trading until you are ready. Too many rookies think it's a cinch and quickly go broke. 4) Buying options a method that makes it VERY difficult to earn a profit. Too many things must go your way and if anything goes wrong, options become worthless pretty quickly. 5) Sell naked options is dangerous. Don't do it. 6) Selling options spreads is a good strategy. read about it. Understand how it works before you use real money. 7) Consider paper trading. It's free and you'll get a little bit of a feel for how option prices change as conditions change. 8) Repeat learn first. Trade later. 9) A Canadian friend uses Interactive Brokers and likes them. their rates are great, but a rookie may be better off with a broker that provides more hand-holding I don't mean to recommend one strategy for you. Consider several and try to decide which makes you most comfortable. Mark http://blog.mdwoptions.com/options_for_rookies/
suggest continue reading from this forum and others, has all the info you need. But something tells me I already know what strategy you intend on using ironcondor.
I believe IB has a Canadian office. Their fees are good, fills are usually fair even with the volitility. What you are looking at doing is very obtainable if you are strick. In most cases you can write a call or put for the premium and or buy the call or put and cover several times in a month on the same stike price. There are many stocks right now that have a beta of approx. 2 that are less than 20 dollars. If you cover (where applicable) you can usually get back in at the same or better price thus generating a higher ROI on your 100k. You will find 5-10 percent is not unreasonable under the above conditions. good luck w
Thanks for all your replies - it's much appreciated! I will continue learning and reading and learning some more. I have no idea what stategy an Iron condor employs, I just thought it sounded neat, haha I will look into TOS and IB - thank you!
Also you can learn from the CBOE free tutorials, eg Dan Sheridan http://oiwebcasts.cboe.com/portal/v_g.asp?G=5 Lots of good stuff. His early video recommends paper trading then trade with $2000 and see if you can make money consistently for a few months; then slowly increase that amount. Sane advice.
The person, for a change, comes with a reasonable goal of 1% and you immediately start pumping him with 5-10%. If you can average 5-10% per month then you should be the richest person in the world in no time. And the "method" you talk about assumes market timing skills (unless I'm reading it wrong).