When the power of masses drive the market then how does the crowd loses money and individuals win? The below mentioned few point will take us through the point.
Look Stock as Business (Options Trading as Full-time business)
Check all the scenarios of Options trading before entering the Trade.
Manage the Options Position with Greeks
Calculate much in advance how much money you will make/
Do not follow the crowd.
Do not wait for the last Nickle of profit
Manage the risk before trading the options strategies.
Never look to prove the market wrong.
Never Speculate or Gamble.
Right opportunity is more important than trading on a regular basis.
The above points are a just brief overview on how one should manage the options trading. Option trading does need active following but not to the extent that you sit in front of the system all the day. To begin with trading it is important one starts with paper trade and then gradually start real trades.
Following the herd mentality would give you the results of the masses. For the purpose of options trading prediction has to be done but profits can be generated even with prediction going wrong. Option strategy is the only place where non-directional strategy can give you consistent and regular rewards.
Managing risk with Greeks is very crucial. Greeks are Gamma, Theta, Delta, Vega, Rho, Vanna and Vomma. These are broadly classified into primary greeks and secondary greeks. Greek helps you to control, adjust and manage the entire option strategy.
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