What are these option things anyway? How do I make them benefit me?

Equity options. Index options. Options against Exchange Traded Funds (ETFs). They come in two varieties; Calls and Puts.

Buy a call and you have the right to buy the underlying security for the option strike price at or before the expiration date. You would do this if you think the price of the underlying will go up. Sell a call and you have the obligation to sell the underlying security for the option strike price at or before the expiration date. You would do this if you think the price of the underlying is not going to change.

Buy a put and you have the right to sell the underlying security for the option strike price at or before the expiration date. You would do this if you think the price of the underlying will go down. Sell a put and you have the obligation to buy the underlying security for the option strike price at or before the expiration date. You would do this if you think the price of the underlying is not going to change.

The option price itself changes based on 1) the underlying security price change compared to its strike price, 2) the amount of time left before it expires, and 3) the change in the supply and demand for the option contracts in the market. The ironic thing is, most investors and traders alike simply buy and sell the option contracts, never translating them to underlying security transactions.

In my last article I laid out some key option trading concepts.

Ideas you need to master if you want to succeed.

Today I want to continue your stock option education.

I’ve recorded a short video to answer the question…

“What Is An Option?”

How do they work?

What are the core concepts you need to grasp?

AND – how can we use those foundations to start making money?

Your first response might be to skip this stuff.

Maybe you think you already know everything you need to know. The truth is, you probably know just enough to be dangerous – not enough to profit in the long run. And, you probably have opened yourself up to heck loads of risk you may not even be aware of.

The good news…

We can fix that really quickly.

We can give you a master level understanding of the option markets.

It starts with this video…