Tuesday, February 10th, 2015

Questions from an Options trading beginner.?

I would like to start trading in the options market, but I have a long way to study before you start. I have several books by various authors and books and videos optionetics eBay.Le favor.1 grateful for any advice. Gann recommendations on books to read? 2. Recommended especially if software is free but if not, what is the most comprehensive? 3. Are there programs or web sites where you can make a practice dummy or trades to see exactly how and what their results may be of the strategies which have usado.Cheers.Gracias capitalist agent. This reference is fantastic! Salud!

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3 Responses to “Questions from an Options trading beginner.?”
  1. planningahead says:

    1. There’s a book of this type for sale on ebay right now — search for “Gann options”

    In general, for book searches, just go to amazon — their search engine os awesome for books.

    2+3. I’ve always just used excel for this. There are two tricky bits: one, you don’t really know what prices contracts actually traded at so you end up using opening or closing prices; and two, don’t forget commissions (which are much more straightforward these days than when I lost my shirt playing options)

    Excel is pretty easy to use to set up formulas. Actually, I prefer it to modeling software written by someone else because while working through the problem takes more work, you end up understanding what is going on much better.

    My bottom-line advice — you will hate this — unless you have a giant computer farm and $10M, just forget options and learn investing.

  2. Capitalist Agent says:

    Valueline Options Survey
    There was a book I used that just listed all the option trading strategies, but the Valueline web site has everything you need
    You don’t need 10 million or a giant computer, just a lap top.
    I don’t get involved in fancy trading techniques, I just buy naked calls and puts, I watch them very closely and always have stop losses. Its better to buy options that have a lot of volume because I’ve found thinly traded options have a huge spread between the bid and ask price, meaning you buy the contract at .80 ($80) but can only sell it at .60 ($60). Also you almost never need to hold an option to expiration, you either trade it because it went down and hit your stop loss or you sell because you made 150% 200% 300% whatever. Stop losses are good because the prices can move very quickly down and if your not watching you can lose a lot. At some point if you made a lot on a trade you may think that you made your money and there is better opportunities now for your investment capital so its time to sell. Usually keep some puts and calls because you can hedge if the market goes up or down. I find fancy trading strategies cost more limit profit and raise the break even point.

    The Chicago Board Options Exchange has a lot of information on trading options also and they have a virtual trading platform that you can practice without using real money.

  3. zman492 says:

    < <<1. Any recommendations on Gann books to read?>>>

    Sorry, I can’t help there.

    < <<2. Recommendations on software esp if it's free but if not, what is the most comprehensive?>>>

    Free:

    The CBOE Options Toolbox

    http://www.cboe.com/LearnCenter/Software.aspx

    Most comprehensive (but way overpriced IMHO) for non-professionals

    http://www.optionvue.com/OV5.aspx

    Very reasonable priced and widely recommended:

    Peter Hoadley’s software

    http://www.hoadley.net/options/options.htm

    < <<3. Are there any programs or websites where you can make dummy/practice trades to see exactly how to do it and what your outcomes may be from the strategies you have used.>>>

    I agree with the recommendation for the CBOE virtual trading site.

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