New to Option and need advice

Discussion in 'Options' started by DatDude, Sep 5, 2018.

  1. lindq

    lindq

    I don't personally recommend long options as a primary trading vehicle under any circumstances other than trying to limit my downside in an overnight long position. But if you feel a burning desire, you may want to look at 3X ETFs/ETNs that trade good volume and tight spreads. Develop a system that gets you into a good move and don't hang out for more than a day or two.
     
    #11     Sep 5, 2018
  2. DatDude

    DatDude

    I read a couple of article that suggest for beginners its better to start with ETFs. Is this something that you think a beginner should start off with? Thanks for the advice, but it seems that jumping into a 3x ETF maybe a little risky for a beginner starting out dont you think?
     
    #12     Sep 5, 2018
  3. gkishot

    gkishot

    Are you sure you are a newbie?
     
    #13     Sep 5, 2018
  4. lindq

    lindq

    You stand little chance of profiting by trading options unless your underlying is something that moves, and moves quickly. And except under rare circumstances, that does not include indexes that aren't leveraged. You need to embrace and welcome volatility if you are going to stand any chance of success in beating spreads and decay.

    Risk and reward walk hand-in-hand.
     
    #14     Sep 5, 2018
  5. DatDude

    DatDude

    I know volume is the key to moving the underlying index and getting in out of the trade. I will look more into the 3xEFTs and paper trade them to get a grasp of how they are traded. Thank you for your advice.
     
    #15     Sep 5, 2018
  6. ironchef

    ironchef

    Yes, only 5 yrs and still trading single leg options.:(
     
    #16     Sep 6, 2018
  7. gkishot

    gkishot

    Do you trade long calls & puts? What is your holding period?
     
    #17     Sep 6, 2018
  8. ironchef

    ironchef

    Single legs, call/put, long/short depending on the situation and my opinion.

    But IMHO, you don't make money mechanically trade single leg options, buy or sell, call or put. Been there done that. The market is too efficient, no one, especially not the professionals or MMs will hand us retails free money willingly.
     
    #18     Sep 6, 2018
    DatDude likes this.
  9. DatDude

    DatDude

    What would suggest to us retailers to play the game like the professional and the MM?
     
    #19     Sep 6, 2018

  10. There is no edge needed in trading simple calls and puts, you are just making directional bets. No need to conern yourself with market makers or professionals just like if you were buying a stock outright. There is no special math or models needed to buy calls and puts. Study the underlying, pick a direction, pick a time frame, understand the basic risk factors and go for it. You don't need a quant or Ph.d in finance to simply place a directional bet.
     
    #20     Sep 6, 2018
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