How To Option Trade And Manage Risk
I have ventured long to find success in the stock market
. And after trading options for about ten years now, I am delighted to make a lot of friends along the way. Of the hundreds of option traders I have met, I am surprised to know that only a few of them are making money from the stock market. Thus, I've been really wondering why more and more people are being drawn into the marvel of the stock market even if most of them end up losing their trading capital.By far, this is one of the most fascinating issues I will discuss with you. Even if people are aware of the risks involved in the trading business with only a few really coming out making money, I believe the reason why more and more investors are jumping into the stock market is that people are actually enjoying the challenge. Believe me; I like the challenge myself. I enjoy analyzing trades, doing the research and forecasting probabilities. There is a sense of excitement in working with stock options, and the challenge that goes along with it gives me a feeling that there is always room for improvement.
Secondly, even if success in option trading does not come immediately, a reason why traders are choosing options is because it develops our creativity. There are countless strategies in option trading that we can develop as long as we keep our mind open to new ideas. With this, I believe option trading is such a vast, wonderful world to explore.
The question is why do lots of our fellow option traders fail to make money in this field? Perhaps the believed answer to the question is that average option traders have no knowledge on properly adjusting their option positions. While the answer is partially true, we are looking for a more logical and acceptable answer to this problem.
Option traders, I believe, do not fail simply due to their choice of adjustment strategies per se. As a matter of fact, most option traders are actually quite good at making portfolio adjustments and money management. As I come to the conclusion of how the real problem arises, I'd say that the failure with most option trading strategies commences at the very start of the trade. You can be a good option trader and risk manager, but lengthy success in option trading will still be far from your reach unless you can hone your skills at constructing option trades with low-risk levels from the very start. This is the secret behind successful option trading for year after year.
It is by studying with San Jose Options that I have come to these insights. I have learned to construct trades with lower risk but with very high probability and expected returns. I have never, ever seen safer ways to construct trades in my whole life before. If you are consistently losing money with options, then it might not be your adjustments, but rather the type of trades you are constructing from the beginning. Failure often times is not in the adjustments; it's embedded into the trade itself. Remember, strategies that worked 20 years ago may not work today. We no longer need to call a broker by telephone to place a trade. Today's market requires option strategies that can handle more volatility. Anyhow, may luck be with you today and your option trading; as for my part, I am pleased to meet yet another option trader like you, and thanks for reading my article.
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