How to trade options on futures - Equity Express Trader
For Keeton, it was losing 30 percent of his capital, although, he adds, global markets were well down at that time.
He started trading in the options market, helping his father with how to trade options on futures investment portfolio. His target is a 3 percent gain on his capital every month, which should give tgade about a 40 percent return annually.
During the day, his target is to gain between four and 10 points, and, he says, the intraday movement in stock options is index provides enough scope and liquidity to meet this target.
Research is mostly free on futured internet. Although he makes it seem so easy, he says day-trading is not an easy career to follow, even if he does make sure he closes out his position before he goes to sleep every night.
One needs to understand hoe technical futuees of trading and charts, to be how to trade options on futures to update constantly on the fundamentals affecting the market, and the emotional discipline to keep an objective view of the market. Keeton was involved in radio at the University of Cape Town, did some film and television work, enrolled briefly for a business sciences degree and then completed a course on becoming a broker at the SA Institute of Financial Markets.
He says day-trading earns him enough to live on, and a little more to reinvest into his trading fund, something he has been working hard at for the past three years. Teacher accused of having sex with pupil on flight home after school trip.
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Buy a futuees if you expect the value of a future to fall. The cost of buying the option is the premium. Traders also write options.
Many futures contracts have options attached to the them. Gold options, for example, are based on the price of gold futures called the underlyingboth cleared through the Chicago Mercantile Exchange CME Group.
The premium and what the option controls varies by the option, but an option position almost always costs less than an equivalent futures position. Buy a call option if you believe the fugures of the underlying will increase.
If the underlying increases in price before the option expires, the value of your option will rise. If the value doesn't increase, you lose the premium paid for the option.
Buy a put option if you believe of the underlying will decrease. If the underlying drops in value before your options expires, your option will increase in value.
If the underlying doesn't drop, you lose the premium paid for the option. Option prices are also based on ' Greeks ,' variables which affect the price ho the option. Options are bought and sold before expiration to lock in a profit or reduce a loss to less than the premium paid.
When someone buys an option, someone else had to write that option. The writer of the option, who can be anyone, receives the premium from the buyer up front income but is then liable to cover the gains attained by the buyer of that option.
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