Basic description of the potential value in options trading:
The value of an option contract is the premium (price).
The premium changes as the stock price fluctuates, and as time passes.
A “CALL” is made when you predict the price of the stock will increase before the option expires.
A “PUT” is the opposite, predicting the price of the stock will decrease before the option expires.
If your prediction is correct, the premium will increase, earning a profit.
If your prediction is incorrect, the premium will decrease, causing a loss.
You can place an order to sell your option any time before the expiration date.
Buying an option contract is often referred to as “Buy to Open”.
Closing an option contract is often referred to as “Sell to Close”.
Multi-leg options use a combination of “Put” and “Call” strategies to obtain a desired level risk and reward. These strategies can take advantage of stock price movements or lack of movement.
Common multi-leg option strategies include bull call spread, bear put spread, long straddle etc.
Options trading begins with opening an investment account.
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Step 1.
There are a number of reputable companies to choose from when opening a brokerage account. When you decide which provider to use, account set up will be mostly self-explanatory. If you would like to trade options, you will need to request that options trading be allowed on your account during or after account set up.
Options Trading Platforms to consider:
Tastytrade
https://tastytrade.com/
Webull
https://www.webull.com/
E*trade
https://us.etrade.com/
Robinhood
https://robinhood.com/us/en/
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Step 2.
You will need to become comfortable with the stock market, understanding the risks and rewards involved in trading. We strongly encourage everyone to take as much time as needed to research and learn about the market before making investment decisions. There are many free videos online that can clarify technical analysis techniques and strategies. Along with technical analysis, it is important to understand the basics on how to perform fundamental analysis, which takes a more in depth look at the financial health of companies. Books such as Warren Buffet and the Interpretation of financial statements can provide a wealth of knowledge on this subject.
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Step 3.
Use multiple sources of information to make informed decisions. Dark Call is an information service that simplifies aggregate information from high-level investment subscription services, financial news, industry professionals, technical analysis tools, and more. Our mission is to give everyone, including beginners, access to the latest market insights, so they can make informed decisions when trading options.