trading options 
 
THE CASH TEACHER
 
 
 
 
   
   
   
   
 
                  The Cash Teacher
   
 

Trading options is when a ton of risk is what you are after.  The profits can be huge but the loses can be as well.  It is definitely not for the faint of heart. 

We will be letting you know some great option trading techniques in the upcoming days to wet your whistle.  Are there ways to make millions?  You know it and we are going to help discover them.  It is crazy to think but why don't normal folks use options?  If they are so bad for investing, then why are options used?  Let me tell you that they are used to make massive amounts of money for those that know how to use them. 

When you learn about them, you will find that it can actually be easier to cash in on options then it is on just a plain old long stock position.  Have you ever thought about doing a straddle on a stock?  This is when you are hoping for a move either way from the current price.  If the stock makes the correct move in either direction, you make money.  The more the move, the more the money.

I love options and the more you learn about them, the more you will love options as well.

FIRST THING FIRST...Sign up for our newsletter down below and get picks sent right to your email.  This takes the leg work out of finding our site and more importantly, who we are putting our money on.

 

 
For those that want a complete definition of what an option is, here is the wiki definition for you.

In finance, an option is a derivative financial instrument that specifies a contract between two parties for a future transaction on an asset at a reference price. The buyer of the option gains the right, but not the obligation, to engage in that transaction, while the seller incurs the corresponding obligation to fulfill the transaction. The price of an option derives from the difference between the reference price and the value of the underlying asset (commonly a stock, a bond, a currency or a futures contract) plus a premium based on the time remaining until the expiration of the option. Other types of options exist, and options can in principle be created for any type of valuable asset.

An option which conveys the right to buy something is called a call; an option which conveys the right to sell is called a put. The reference price at which the underlying may be traded is called the strike price or exercise price. The process of activating an option and thereby trading the underlying at the agreed-upon price is referred to as exercising it. Most options have an expiration date. If the option is not exercised by the expiration date, it becomes void and worthless.

In return for assuming the obligation, called writing the option, the originator of the option collects a payment, the premium, from the buyer. The writer of an option must make good on delivering (or receiving) the underlying asset or its cash equivalent, if the option is exercised.

An option can usually be sold by its original buyer to another party. Many options are created in standardized form and traded on an anonymous options exchange among the general public, while other over-the-counter options are customized ad hoc to the desires of the buyer, usually by an investment bank.

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