How profitable can investing in stock options be?

Question

I'm new to investing yet I've done extensive reading on basic straight investing in stocks...just wanted to get some insight on the subject from experienced option traders.

Answer 1

Options investing is very different from stock investing. With options you can choose very risky strategies that have the potential of a very high return or very low risk strategies that have a low potential return, or anything in between.

If you pick high risk strategies, and if you are both very good and very lucky, you can make a lot of money very quickly. Of course, with high risk strategies you are much more likely to lose money quickly.

If you choose low risk strategies, while you will have some losses on some positions, you will have a relatively consistent moderate return. This is the choice of most professional option traders, including market makers.

The highest return I have ever seen from an options trade was a 500-fold return in 24 hours, where you could have turned $2,000 into a million dollars in one day. (I only saw this in hindsight. I do not know anyone who actually did that.) Needless to say such a return is extremely rare. It would be far easier to lose your entire $2,000 investment 1,000 times in a row if you tried to find such a high return.

Answer 2

It's kinda like betting the ponies, it can be profitable or it can be risky. Even the surest pony can break its leg in the starting gate. If you can't afford to loose, stay away.

Answer 3

it can be very profitable, but it is very risky. it is not advisable unless you are rich and dont mind losing lots of money. as a new investor, stick with safer investments.

Answer 4

If youre in the right market, you can become a multi-millionaire, go for it but invest wisely!!!!!!!!