A Beginners Guide On How To Trade With Options

Welcome, my dear reader! You’ve taken the first step to becoming an options trading guru. Now, you might be thinking – “Options trading? That sounds complicated. I don’t think I’m smart enough to do that.” But don’t worry, my friend! Options trading is not rocket science. It’s just like playing chess, but with money. So, let’s get started and learn how to play this game of money chess.

Can a beginner trade in options?

Absolutely! Even if you’re a beginner, you can still trade-in options. It’s like driving a car. At first, it might seem overwhelming, but with practice, it becomes second nature. However, just like driving a car, you need to learn the basics before you start trading. So, let’s buckle up and learn how to trade options.

How much money do you need to trade options?

Ah, the million-dollar question. Well, not really. You don’t need a million dollars to trade options. In fact, you can start with as little as Rs. 5,000. That’s like buying one fancy coffee at Starbucks. However, keep in mind that the more money you have, the more options you have (pun intended). So, if you want to have more flexibility in your trading, you’ll need more capital.

Is options trading better than stocks?

Now, this is a tricky question. It’s like asking whether biryani is better than pizza. Both are delicious, but it depends on your mood and preference. Similarly, both options trading and stock trading have their pros and cons. Options trading can give you more flexibility and potentially higher profits, but it also comes with higher risks. On the other hand, stock trading is more straightforward, but the potential profits are limited. So, it’s up to you to decide which one suits your appetite for risk and reward.

Read – The Ultimate Comparison – Stock Trading vs. Options Trading

What are the 4 types of options?

There are four types of options – call options, put options, covered call options, and cash-secured put options. Now, don’t let the fancy names scare you. Let me explain in a language we all understand – Bollywood. A call option is like Salman Khan calling Katrina Kaif to star in his movie. A put option is like Shah Rukh Khan putting Katrina Kaif on the waiting list for his movie. A covered call option is like Ranbir Kapoor covering up his relationship with Alia Bhatt from the media. And a cash-secured put option is like Akshay Kumar securing his bag of money for his next movie. See, it’s not that complicated!

Is option trading a skill or luck?

Well, my friend, it’s a bit of both. You need to have the skill to analyze the market and make informed decisions. But, luck also plays a role. Sometimes the market can be unpredictable, and no amount of analysis can prepare you for that. It’s like playing poker. You need to have the skills to read your opponent and make the right move, but sometimes luck can make or break your game.

Read – How To Generate Consistent Profits With Options Trading

Which option is best to trade?

Ah, the golden question. Unfortunately, there’s no one-size-fits-all answer. It depends on your investment strategy and risk appetite. Some people prefer to trade in call options, while others prefer put options. Some people even like to combine both call and put options to create a strategy that works for them. The key is to understand the different options and their associated risks before making a decision.

Is option trading very risky?

Well, it can be. But, so can crossing the road in India. The key is to be aware of the risks and take appropriate measures to mitigate them. You can use strategies like hedging or stop-loss orders to limit your losses. And remember, the more you know, the less risky it becomes. That’s why it’s important to educate yourself before diving into the world of options trading.

Which is better intraday or options?

It’s like asking which is better – a dosa or a biryani? It depends on your taste buds. Intraday trading can be exciting and profitable, but it requires constant monitoring and can be stressful. Options trading, on the other hand, can provide more flexibility and is less time-consuming, but it requires a deeper understanding of the market. So, choose your dish wisely based on your preference.

Why option selling is costly?

Well, it’s like being a landlord in Mumbai. You need to pay a high price to own the property, and then you need to maintain it and pay the property tax. Similarly, when you sell an option, you’re essentially taking on the role of the landlord. You need to pay a premium to buy the option, and then you need to maintain it by monitoring the market and taking appropriate measures. So, it’s a costly affair, but if done right, it can provide a steady stream of income.

Can option traders become rich?

Of course, they can. Just like how Rajnikanth became the superstar of Indian cinema, options traders can become superstars of the stock market. But, it takes hard work, dedication, and a bit of luck. You need to educate yourself, create a strategy, and stick to it. And, most importantly, you need to have patience. Rome wasn’t built in a day, and neither was the wealth of Warren Buffett.

Ready to become the Rajnikanth of Options Trading? Checkout Proschool’s Options Trading Course

What is the secret of options trading?

Well, it’s not really a secret, but more like a recipe. Just like how your grandma has a secret recipe for her famous chicken curry, successful options traders have a recipe for their success. And, like any recipe, it has a few key ingredients – education, strategy, risk management, patience, and discipline. Once you have all these ingredients in the right proportion, you can create a dish that’s both tasty and profitable.

Become An Options Trading Guru With Proschool’s Options Trading Course

Having established itself as one of the best institutions for finance certifications, IMS Proschool has now launched a Certification Course On Options Trading. And the best part – the course does not require any prerequisite knowledge, meaning you can enrol for this course even if you don’t know anything about options trading, or even trading. This 4 months certification course ensures that you become a pro in trading and get a chance to work with top trading organizations.

Here are the key highlights of the course –

• You learn riskless mock trading on Sensibull
• The course equally focuses on theory as well as practical aspects
• You can easily complete this course along with graduation
• Real traders with a combined experience of 15+ years will teach you the niti-grities of the course.
• Individuals interested in NISM certifications can easily attempt the NISM series 8 test post the completion of this course.
• IMS Proschool’s in-house dedicated placement team will ensure that you are ready to face the interviews once the course is completed.

Ready to become a pro options trader? Enrol for Proschool’s Options Trading Course