When you trade options online you should know they understand that online option traders that need access to reliable tools, also real-time information and resources that provide plus ongoing education on how to trade options. They also know that the cost of options can actually add up quickly and that is why the online sites offer simple and fair pricing for stock and option trades.
Here is why I opened online option trading account
- Low cost options trading
- They offer the same low, everyday price for everyone: Maybe even just 65 cents per contract, plus a base of $5.
- Comparison for trade of 10 option contracts ++Commissions and fees.
- I took advantage of the flat rate no matter how often my trade or the size of my account.
- What do you think about spread trades? At online option trading sites, spread trades are charged for only a single leg of the trade. Even if it’s a two-, three- or four-leg option trade, I am paying only one base charge.
Powerful tools for option traders
I find out that virtually everything I need to trade options intelligently there. Like options scanners, dynamic options chains, to Probability Calculator and P+L Calculator, plus streaming platform TradeKing LIVE, they really have me covered. The trading platform makes trading options online, including advanced options order a snap.
I have learned a lot from online option trading sites, because the best trades learn all the time. The best traders are always learning. Some of the online option trading sites have education centers where you can find hundreds of informative videos and a free online webinar series, also there are blogs. Maybe you are a beginner like I was or you are trader for years, you will be able to fine amazing ideas in the education center.
I have always been happy with the outstanding customer service. I can contact them if I have any question and they are very fast with answering them. They really concentrated for the trades to have the best customer service there is.
As I am doing now, I am sharing my trading experiences, in these way fresh opportunities and lessons are learned. I can view the latest activity and I can filter them in order to have a view of the last option trades. So if you are eager to understand options trading better choose the right online option trading site, the one that suites you.
So make more strategies that you will use while you trade, in that way you will make better chances to turn the trade as you want to be. Be careful when making the trades, learn first which will be the best way to do it and at all cost don’t make big mistakes where you will loss even all of your money. I can tell you good luck and make the best choice as I did.
From my side of view buying OTM calls outright is one of the hardest ways to make money consistently in the options world. If you put limit to my strategy, I probably would find myself losing money and of course I won’t learn much from it during the process. I have considered jump-starting my options education by learning few other strategies, and with it I improved my potential to earn solid returns while I build my knowledge. I am going to share what I have learn so everyone else can start online option trading.
It’s really tough enough to call the direction on a stock purchase and when I buy options, however, not just I have to be right about the direction of the move, but I also have to be right about the timing. If I am wrong about either, myr trade may result in a full loss of the option premium paid.
As my first oray into options, I considered selling an OTM call on a stock that I already own. This strategy is known as a “covered call”. By selling the call, I take the obligation to sell my stock at the strike price stated in the option. If the strike price is higher than the stock’s current market price, all what I am saying is: if the stock goes up to the strike price, it’s really okay if the call buyer takes, or “calls”, that stock away from me.
When I am taking this obligation I earn cash from the sale of my OTM call. This strategy made me to earn some income on the stocks when I am bullish, but I would mind selling the stock when he price goes up. So if the market remains flat, I would collect the premium for selling the call and retain my long stock position. But, if the stock goes down and I want out, I would just buy back the option,by closing out the short position, and with selling the stock to close the long position.I might have a loss in the stock when the position is closed.
For an alternative to buying calls, selling covered calls are considered a smart, usually low-risk strategy to earn income and familiarize myself with the dynamics of the options market. Selling covered calls is enabling me to watch the option closely and see how its price reacts to small moves in the stock and how the price decays over time.
Option trading is very flexible and it enables me to trade effectively in all kinds of market conditions. But I could only take advantage of this flexibility if I stay open to learning new strategies. With buying spreads there is an offer in a great way to capitalize on different market conditions. When I buy a spread it is known as a “long spread” position. Fist I familiarize myself with the possibilities of spreads, so that I could recognize the right conditions to use them.
Not having a definite exit plan prior to expiration
Probably you have heard million times before that in trading options just like in stocks, it is very critical controlling the emotions. In order to control the emotions I did something very simple, I had a plan and I worked with my plan.
By planning my exit didn’t jut minimized my loss on the downside. I had an exit plan, even when things were going my way. I have chosen upside exit point and my downside exit point too and also the timeframes for each exit.
Trading with a plan helped me establish more successful patterns of trading and kept my worries more in check.
I have used online option trading for years now. In the beginning it was really hard t find which site had the best offers for the option trade to go smoothly and the way I like it. Here is my opinion for all of you, how to chose the best option trading online site.
Market or Limit Order
Be aware of some company’s charges because they charge different brokerage fees for different types of orders. You probably should note the fee for limit orders since you almost never place market orders.
Quality of Service
You should determine which is the best options trade, commission charges and should not be the only consideration. When it comes to online brokers, site availability find the speed of execution and ease of use are very important too.
Availability & Speed of Execution
Site availability and responsiveness are maybe one of the most crucial aspects to look out for when selecting an online option trading. No matter how low the commission charges are if the trade does not get through because the option trade site is overwhelmed by ultra high load and after that becomes unavailable, the amount of transaction fees you save is not going to be worth it.
Ease of Use
With option trades are already complicated enough; it sure doesn’t help when you really still have to puzzle over how to use the order placement form. An easy to understand user interface helps with minimizing errors, which can be extremely expensive. Look for option trading brokerages that offer single-screen order entry forms for covered calls, butterflies, condors, and other multi-legged option strategies.
Be careful when opening n account, firs of all look for hidden fees that probably won’t do you any good. So if an option trade charges an unusually low fee compared to the industry norms, probably there are other fees you should be aware of. Some common hidden fees like:
Account Inactivity Fee – Some brokerages charges a fee if you did’t make any trade after a certain period of time.
Annual Maintenance Fee – This is a fee levied every year as when have an account with the brokerage firm, and it doesn’t matter if you have made any trade.
Minimum Balance Fee – When your account balance is below a certain threshold, this is a fee that is levied peroidically.