Trading Decisions

Trading can be fun, but
trading is often stressful.

Trading can be profitable,
but losses are part of the game. Your
ability to keep those losses reasonable with good risk management skills is
very important to your long-term success.

Serious trading is a
full-time profession, but part-time traders also can be successful.

Do you enjoy trading?  Do like making those trading decisions?  If you do,
then adding options strategies to your arsenal of investment tools is a smart
idea.

Options allow you to hedge
(reduce the risk of owning) stock market investments.

Many option strategies
involve limited risk and provide the opportunity to earn profits in any type of
market environment. Thus, you can
prosper when the markets rise, fall, or trade in a range. For clarification: it’s not that easy. Don’t assume that all strategies make money
under all market conditions. Some
methods are bullish, some bearish, and some do best when the markets go
nowhere. But, if you have a market
opinion and want to profit when that opinion is correct, options are for you.

If you don’t have a market
opinion (I almost never do) you can adopt market-neutral strategies. Some depend on extreme volatility for
success, while others generate good profits when the market is not volatile. There are many choices. The way to begin is by learning the basics.

If you are an investor who
only owns stocks or mutual funds, consider learning how to hedge
those holdings with options.

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