I am getting into trading options and researching the different kinds of option trades. How do you find good trades? Do you use a scanning software of some kind? Do you have a couple of option trades that you specialize in and then look for stocks with options that meet certain criteria? Further, what kind of option trade would you consider your "bread and butter" and how do you find such trades amongst all the options out there? Is it necessary to have expensive option software etc...?
cboe and think or swim have tons of great videos. http://www.thinkorswim.com/tos/displayPage.tos?webpage=onlineSeminar&displayFormat=hide this is nothing advanced, but it's a good place to get started. also, open up a papertrade account with think or swim, and you can use the platform for free with delayed quotes.
Most stock traders use multiple stocks b/c the only make money if the stock is moving. It can move up or it can move down but it has to move. Once the stock starts moving sideways the traders need to look for something else or wait it out. With options you don't really need a scanner. You only need 1 stock you like and are interested in to trade. The reason is with options you can make money if the stock goes up, goes down, or sideways. The stock could trade at the same price level for 6 months and you can still make money with options. So the trick then isn't to learn to find the right stock to trade options on, the trick is to know which play to use based on what YOUR stock is doing. Just starting out learn all you can about the following trades to get started: 1. Bull Call Spread - used if you think the stock is going up. 2. Bear Call Spread - used if you think the stock is going down 3. Long Straddles/Strangles - used if you expect a LARGE amount of movement but aren't sure about direction. 4. Short Straddles/Strangles - used when you expect the stock to stay within a certain range for a while. Of course there are a LOT more trade types and techniques but this give you 4