Hi, if one is starting out with a small account of say $2,000, could swing trading using vanilla equity options be a viable strategy? Thanks.
Read wall Street bets on https://www.reddit.com/r/wallstreetbets/ One gambler bought $4,000 of nvda puts and rolled down twice ending up with $250,000.
Thanks, I will have a read of this. Appreciate the link. However, I am not looking on this as a gamble. I am hoping that it could be a reliable strategy that creates consistent profit. This would be using calculated risk of course.
Once you have read wall street bets you will get the picture. Read all the threads on this site about selling options and google it.
Thanks, I will do. I checked out WBS and it did seem like the sort of forum where more, shall we say traditional, investment strategies area not followed. Is that a fair assessment?
Thanks, appreciate the reply but could you please, if you have the time, expand on that? It would help us newbies understand why this is not a viable strategy. Cheers.
Referencing your opening post, there are three red flags right away. (1) Starting out, (2) Options, and (3) Under capitalized. Starting any trading venture, you need to be well capitalized, because learning comes from experience, and experience in trading requires taking losses. (No pain, no gain.) Options are appropriate if-and-only you have a solid track record in trading underlying instruments. Options are leveraged derivatives with very high trading costs, and they are not at all for somebody with training wheels. Best thing for you to do is spend a couple years testing and in simulation before you part with your money.
WSB is students buying options with their student loans in a robin hood account. If they go bust they eat noodles for three years.