i have a few books on the stock market and i plan on trying out the stock market out in about a month. now a few weeks ago i went to a seminar and they said buying stock options is better than buying stocks...is that true?
do you know of any sites that deal with option education?
also at the seminar they said to use candlestick charting and where can i get more education on that?
2007-01-28 12:35:24 · 9 answers · asked by Anonymous in Business & Finance ➔ Investing
You might take a look at http://www.optionsclearing.com/publications/uso/usointro.jsp
I would suggest you stay away from options until you've been trading stocks for a while (preferably successfully)
http://www.candlesticker.com/ will show you the various candlestick patterns and what they mean. I think however, that when they said to use candlestick charting, they probably meant to display your charts with candlestics because they provide immediate understanding of how your stock performed over the selected time period (minute, hour, day, week, etc.)
2007-01-28 16:55:15 · answer #1 · answered by huskie 4 · 0⤊ 0⤋
Stocks are less risky than stock options hands down - period. Anyone telling you otherwise is trying to sell you a seminar, newsletter or some kind of notification service.
However for sophisticated investors stocks and options go hand in hand. A couple of examples:
You own a stock you think has topped out a bit for the time being. Sell a covered call to get a little bump to your portfolio.
You think your stock will go down in the short term - buy a put for protection.
You think your stock will go up but you are short on cash because you are heavily invested - buy a call to reap some short term benefits.
Options traded on their own with your account principal is suicide however. They should be used to complement a well designed equity portfolio. They are incredibly leveraged and because they expire (wasting asset) they all eventually have no value.
2007-01-28 16:43:21 · answer #2 · answered by Anonymous · 0⤊ 0⤋
As an individual, you can stocks.
Stock options, however, are granted to employees.
You may have confused stock options with puts and calls on a stock. That's where you "bet" which direction a stock will move -- up or down in value.
Unless you're able to buy more than 20 individual stocks, you're much better offer investing in mutual funds from a low-cost mutual fund company like Vanguard.
More information on candlestick charting available in link below.
2007-01-28 12:41:46 · answer #3 · answered by Calisoxfan 3 · 0⤊ 0⤋
Totally depends on your math aptitude and focus.
You will need to do extra homework for the options and hang with them like a hawk.
If you intuitively understand the option process after reading about it and have a lot time to manage it, then maybe options.
If you have a life otherwise, I would go with stocks.
Yahoo finance has an investing education link , check it out. Here is the one for options . . .
http://biz.yahoo.com/opt/
2007-01-28 12:47:58 · answer #4 · answered by kate 7 · 0⤊ 0⤋
It depends on your risk appetite and capital.
Options pricing (premium) depends on their underlying assets (stock). Options premium is at fractions of price of its underlying assets. Options has expiry date too. Stock does not.
Some websites where you can find information
www.cboe.com
www.investopedia.com (general investment question)
Which one is safer depends on your preparation before going into the trade.
2007-01-28 12:55:58 · answer #5 · answered by usrtamt 1 · 0⤊ 0⤋
Anybody who wants you to go into options is trying to sell you their system or otherwise get your money.
Don't do it.
Invest in mutual funds or exchange traded funds and be patient.
There's only one way to make money - slowly.
2007-01-28 16:30:19 · answer #6 · answered by Anonymous · 0⤊ 0⤋