Thank-you,
I will learn what I need to. However I have been highly successful.
I might have made too many trades (about 130). Yet I have earned 150% of my working capital after discounting my loosing trades.
So far my biggest mistake is not holding the trade long enough. And because of this I missed about an additional 100% gain.
My next question is related to the underling stock I choose. Many of these have too little activity during a day. Does that mean I must only choose the option with thousands of trades a day?
--- In OptionClub@yahoogro
>
> it is important to understand that options are derivative securities.
> The value of an option will not move in step with the underlying stock
> because there are several factors that effect its price. Directional
> movement of the underlying security is only one of those factors.
>
> Option values are also effected by other factors such as the time left
> until expiration, interest rates, dividends, but the most significant
> factor effecting their value is implied volatility. If this is starting
> to sound a bit complex...well, it is.
>
> My suggestion is that you stop trading options for the time being and
> spend some time learning about how these instruments work.
>
> Christopher Smith
> TheOptionClub.
>
> --- In OptionClub@yahoogro
> >
> > I have been trading calls for 60 days. I never traded options before.
> I was just a stock investor.
> >
> > I need some understanding for why the calls do not move in step with
> the stock price exactly? I always buy barely out of the money with a 3
> month duration. Most of my selections have a high beta.
> >
>
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