You too can learn stock option trading techniques which produce consistent daily profits.
Advantage of Trading Options
The advantage of trading options is that it gives you 10 – 20 times more leverage . Extremely limited downside and low capital requirements – you only need to have 1/10 or 1/20 of the amount of money compared to buying the actual stock.
Example: One options contract controls 100 shares of a stock. Options trading is much less expensive than trading shares. For example, if you wanted to buy TESLA and it's trading at $1,000. If you bought 100 shares of TSLA you would be spending $100,000.00
To get control of the same number of shares trading stock options you need a fraction of that money in your account. If you bought one option contract at $15, you'd only be spending $1,500 to have access to the same 100 shares. You are putting up much less capital, and it offers you the opportunity to buy the stock at a discount. This is a great way to trade the stock market with little money. The even better news is your profit potential is much higher, especially if you can predict direction.
Let’s say Tesla Stock goes up $10 in one day, or even better in one hour. If you owned that same 100 shares you are excited, you just made $1,000 on your $100,000 investment. That equates to a 1% ROI. Now, if during that same hour the TESLA Option went up a realistic $7.50, then you just made a 50% ROI. Your $1500 investment is now worth 2,250.00.
That is what I call LEVERAGE!
A secret stock option trading strategy, taught by Safe Day Trading, allows you to trade with an account size as little as $500. This strategy can make you $500 a day swing trading and day trading stock options.
This is one of the most exciting approaches I have ever found to make consistent money trading the market. I have personally made on several occasions $2,000.00 or more in a day using the simple SafeDay techniques trading options. I was able to do that back when my trading account had only $5,000.00 in the account!
One key to this strategy, Only trade highly volatile, liquid stocks that have options with high trading volume, and significant open interest. Do this so that you have a very small spread when you buy the option. And of course, you need to know how to read the candles. The SafeDay Trading DOT will help you know when, why, where and which direction to enter the trade.
When you are day trading or swing trading stock options, you only want to buy puts and calls that have very tight spreads. (the spread is the difference between the bid and ask).
Technical Analysis Matters
Next, you need to understand that in the short term (anywhere from 1 hour to 5 days) price action, money flows and technicals drive 95% of the stock price. To be effective you need to know what chart patterns work for short term options and which don’t. Luckily, there are a few great ones that work almost all of the time. You can learn them in the FREE course from SafeDayTrading.org
Learn The Rules:
Lastly; you need to understand the Safe Day Trading rules. You need the follow these rules with every trade
- Only trade stocks that have options that are very liquid with high volume, so that when you buy the put or call the spread is very low, so that you are not paying a big premium on any trade.
- Only trade volatile stocks with great short-term chart patterns. Like the ones we discuss inside Safe Day Trading training
- Control your risk: Only Buy Calls and Buy Puts. Do Not Sell Calls or Puts.
- Always use your Stops! Be prepared for your Targets and do not be afraid to take PROFIT when it comes to you.
- You want to use the Safe Day Trading stock option strategy of only buying in-the-money calls and puts, in which the options moves 60 – 70% with the stock.
- And most importantly; You need to utilize those trading Indicators that will help you recognize TREND, MOMENTUM, and DIRECTION CHANGE. At Safe Day Trading we specialize in helping students not only pick the stocks but give you the ability to decipher how to pick them yourself by following specific trading signals. One of course is the SafeDay Trading DOT.
Its Your Turn
TO LEARN MORE about trading with precision and purpose please visit us at SafeDayTrading.org . Get started with the FREE version and decide if making money is for you.
The information contained in this article is intended to provide helpful information for the reader. It should be understood that the author is not rendering financial advice or any other kind of financial professional services. Please Be Aware…as with any investing program there are significant financial risks. Your results will vary based on market conditions, as well as your commitment and desire to learn and implement the program as directed. Past results in no way should be used to predict future returns.
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