options newbie question

Discussion in 'Options' started by Bobler, Jun 21, 2010.

  1. Bobler


    hello im new to elite trader and im new to stocks just turned 19 getting my portfolio started ive been trading stocks and now im interested in options ive learned a lot in the past year or so and ive seen that when stock prices move the options contracts price moves Alot (30 -40%)
    when you want to sell your call option contracts back into the market and receive the amount on the options contract current price(sell at a 40% increase as my TP)thats called selling to close if im not mistaken

    is it possible to make money just trading off volatility and swings in the options contract price

    on the day that bp dropped 15% the put contracts jumped over 500% some even jumped 900% when the oil spill first occurred i was looking at Very deep outta the money puts valued around .01 as i am young 500 dollars into this wouldn't be bad lose, for 500 contracts + 1$/contract would be 1000$ when bp dropped 15% those same contracts were valued at 1.47 x 500 contracts(500x100=50 000) =73500-1000 = a total profit of 72500