Options For Beginners - Top 3 Strategies For Profit

Introduction: Stock Options
There are four basic options trades you can make: buying a call option, selling a call option, buying a put option, and selling a put option. So buy calls, buy puts, sell calls or sell puts. It’s very important to note that when you enter into a contract there are always 2 parties involved. When you BUY a contract, you are buying it from the SELLER - the person on the OTHER side of the trade. When you SELL a contract - you are selling to the BUYER of the contract - and of course this will ALSO mean that when you BUY a contract you pay money (the premium) and when you SELL a contract you are getting paid, or collecting, money (the premium)

Each of these contracts have certain characteristics. Each option contract has a strike price, expiration date and a premium price. Here are the 4 basic options trades one can make.

BUYING A CALL : Gives the buyer the right (but not the obligation) to buy stock at a given strike price on or before the expiration date. You pay a premium to buy this option contract.

BUYING A PUT: Gives the buyer the right (but not he obligation) to sell stock at a given strike price on or before the expiration date. Again you pay a premium to buy a put contract.

SELLING A CALL : Gives the seller the obligation to sell shares at a given stock price on or before the expiration date. When you sell a call, you collect the premium for doing so.

SELLING PUT: Gives the seller the obligation to buy shares at a given strike price on or before the expiration date. And again you are selling a put contract so you are receiving money - the premium for doing so.

[kenderdine]

I'm really enjoying your videos, options are becoming much easier to understand now but I live off dividends, It's one of the most passive and effective ways to build an income stream while compounding.

[goldensphinx]

I watched so many of your videos multiple times when I first started with selling options, they were the most helpful for me. Great to see you’re back!

[knockknock]

So thankful that you're back.

Can you make an in depth video on covered calls? Especially going through cases when the trade goes extremely out of your way. How do you roll, how much do you move the strike and expiration etc.

I know there are other videos out there but your way of explanation is incomparable in the option trading subject.

[emeraldjonz.]

Started listening to you a couple of years ago and finally started trading last year. So good to have you back!

[op]

I came across one of your videos on selling covered calls and found it to be the best straightforward and easy to follow videos I've seen on youtube. I made my first $3, 000 within 48 hours of your video. Thank you so much for what you do!

[sciencelabvideosl]

Omg you’re I’m so glad to see you again! You’re such a great teacher! You explain things so well for slow people like me lol.

[JosefinaHalasinski]

I Hit 12k today trading. Started last month 2024. Financial education is indeed required for more than 70% of the society in the country as very few are literate on the subject. thanks to Louise O'Brien for helping me achieve this.

[spicelord]

Its great to have posting again. It is even more so that you are healthy and well. Welcome back

[TheFinancialMinutes]

Great video Alex, glad to see you back!

I would mention the risk on selling puts, as it's not a fool-proof strategy. If the stock keeps dropping in value you can lose significant money as you own 100 shares. NKE would be a good example over the past year:

If you sold a $100 NKE put at the beginning of the year, you'd be down ~30% on your 100 shares for a $3, 000 loss.

[designbydavid]

Whoa, welcome back! You got me into options originally.

[LoamWolf]

We missed your content so much! Welcome back amigo! I've been fumbling around trying to learn this stuff, but wishing that you were here with updates. We hope you are well and glad to see you again.

[Khans-in-va]

11:30 Alex, glad too see you back! I admire your great tutorials, especially when you add examples from Robinhood!!! Many thanks...

[valerie-seth]

Hit 200k today. Thank you for all the knowledge and nuggets you had thrown my way over the last months. Started with 17k in last month 2024.

[CRpatriot]

Hi, what if I don’t want to buy the stocks and it’s getting close to the expiration date and the price can I get out and just keep the premium

[noelbetancourt]

Good to see you back, I've been investing for a while now and your videos were the first ones I watched about Option trading, super easy to understand. Thank you

[ron]

Good video. Do you recommend holding the calls bought through earnings since there is IV crush?

[zeekflash]

We miss your humor and easy going teaching style, bro .
Welcome back
Maybe do a, picking stock and technical analysis
Thx

[kkwin]

Hi Alex, i would like to learn more in depth. Do you have online lessons or in perso 2:36 n lessons that i can register please?

[VirusZero]

Im glad you remembered your youtube password. These other people's videos on options didn't feel the same as yours

[Lathe-Lizard]

I really comprehend your explanations! Finally. Gosh I’ve picked so many winning stocks over the years and just never had capital to make a ton of profit. Now I understand a couple of options which is a huge improvement.