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#738 - Is Investing In Options A Good Idea?: Hey everyone. This is Kirk here again from Option Alpha and welcome back to the daily call. Today, we’re going to answer the question, “Is investing in options a good idea?” And so, this kind of dovetails on yesterday’s podcast, but of course,...

#738 - Is Investing In Options A Good Idea?: Hey everyone. This is Kirk here again from Option Alpha and welcome back to the daily call. Today, we’re going to answer the question, “Is investing in options a good idea?” And so, this kind of dovetails on yesterday’s podcast, but of course,...

A partire dalThe "Daily Call" From Option Alpha


#738 - Is Investing In Options A Good Idea?: Hey everyone. This is Kirk here again from Option Alpha and welcome back to the daily call. Today, we’re going to answer the question, “Is investing in options a good idea?” And so, this kind of dovetails on yesterday’s podcast, but of course,...

A partire dalThe "Daily Call" From Option Alpha

valutazioni:
Lunghezza:
4 minuti
Pubblicato:
Sep 29, 2019
Formato:
Episodio podcast

Descrizione

Hey everyone. This is Kirk here again from Option Alpha and welcome back to the daily call. Today, we’re going to answer the question, “Is investing in options a good idea?” And so, this kind of dovetails on yesterday’s podcast, but of course, investing in options is a really good idea. In fact, that’s why we’re here. That’s the whole mission of Option Alpha, is to help more people understand not only what options trading is, but how they can invest in options trading. Not just day trade options because that’s not what we’re about. We’re about investing in options as a business, as a source of income moving forward, as a source of capital and wealth preservation and capital appreciation for your portfolio because options trading is a very profitable way to invest in the market and it’s definitely more profitable than using stocks from a capital perspective, from a return perspective, from a volatility perspective as long as you know how to use option contracts appropriately and to control the risk. I think one of the key things for me about options trading that I always try to tell people right out of the gate when I talk about what I do or what we do here at Option Alpha is that options trading gives you a lot more flexibility in when you can make money in the market environment. You see, most people are always just assuming that you can only make money if stocks or positions, whatever they have, bonds, real estate, REITs, whenever goes up in price. That’s what they’re accustomed to. That’s what they’re conditioned to understand. They have to buy at a low priced and they have to sell at a high price and there’s basically nothing in between. Bull markets are good. Bear markets are absolutely terrible because you can’t make money in those environments. What we try to teach people obviously is that in options trading, you can create an option payoff diagram that makes money in whatever environment you think might be coming next. Do you think that the market’s going to go up? Do you think it’s going to go down? Do you think it’s going to stay range bound? Do you not even know where it’s going to go, but you think it’s going to go really high or really low very quickly? You can build option strategies that basically allow you to profit from these market environment expectations in multiple directions, not just in a one-directional move higher in the underlying shares. That is very powerful because what it could do for many people is take a potential 50% drawdown that they would’ve had in stocks and reduce it to a 20% drawdown. Now, they still might lose money in a strategy, but taking a 20% haircut versus a 50% haircut is something I would do any day of the week because it would allow you to then re-grow your capital from a much higher level and that’s some of the stuff that I think options trading can do for people. I think it can help both with higher returns when things are really good and I think it can help with lowering drawdowns when things get really hairy and things get very volatile in the markets. That to me is really what this thing is all about. It’s not free risk. It doesn’t come without a little bit of pain and a little bit of volatility and drawdowns in your account. There’s no free lunch here, but it will give you I think a lot more choices, a lot more options (no pun intended) on how you can invest your money. Hopefully this helps out. As always, if you have any questions, let me know and until next time, happy trading.
Pubblicato:
Sep 29, 2019
Formato:
Episodio podcast