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8 Reasons Why You Are Losing Money Trading Options

why you are losing money trading options

A commonly quoted statistic is that only the top 10% of traders are ever successful. If you’ve started trading options with little success, rest assured: you have come to the right place. Here at Option Posts, we believe that trading is a skill that can be taught to anyone willing to learn. Taking the time […]

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When is the optimal time to put on an options trade?

Options trading is unique in that options contracts expire at a specific point in the future; this time component makes them fundamentally different from other kinds of trading. However, timing can be a tough aspect for new traders to understand. For any one stock’s options, you can choose from many different expirations, ranging from a […]

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How to Read Option Profit and Loss Diagrams

reading option pl diagrams

Option profit/loss diagrams visually represent an option strategy’s profits or losses as the different inputs into the pricing model change. As you dive deeper into more complex options strategies with multiple buying and selling options, these diagrams will be the key to seeing how to profit from time decay and volatility (factors unrelated to stock […]

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What Is Our Edge In Options Trading?

Every successful business has some advantage over its competitors, and the options trading business is no exception. In this post, we’ll explain our edge in options trading; understanding our strategy is one of the most important steps you can take towards becoming a successful options trader. Since successful options traders operate a lot like insurance […]

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Options Expiration: What it is and How to deal with it

Options Expiration and Assignment

The options expiration and assignment process can often be confusing for new options traders. In this article, we will clearly explain the entire options expiration and assignment process to give you the knowledge and confidence to get started in options trading. Options Expiration Basics Option contracts have a finite life. There is a specified time […]

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Selling Puts: How To Buy Stocks At A Discount

Selling Puts for Beginners: How to Buy Stocks at a Discount If you want to understand how to buy stocks at a sizable discount AND get paid for doing so, learn how to sell put options. In this article, we’ll help you get started with this simple but powerful strategy. If you missed our article […]

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How To Read An Option Chain

how to read an option chain

So, what is an option chain? Reading an option chain, or option pricing table, is a fundamental skill to master before stepping into any option trade. In this post, we’ll show you how to read an option chain step-by-step. An option chain, simply put, is a list of all of a stock’s option contracts which […]

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5 Most Important Option Contract Specifications

option contract specifications

Like any formal agreement between two parties, option contracts clearly delineate all of the parameters of the contract between buyer and seller. In this article, we’ll explain each of the five key option contract specifications in detail. Here is an example of an option contract: XYZ February 50 call for 1.50 The pieces of this […]

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Option Greeks Explained [Greeks Definitions]

Option Greeks explained

Understanding Option Greeks As a beginning options trader, you have likely heard of “Option Greeks.” The Greeks are fundamental metrics we use to make informed trading decisions and to gauge our trades, portfolio risk, and profit potential. The Greeks measure how an option price or premium will change in response to changes in any of the […]

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How Are Option Prices Determined?

Understanding option pricing is the key to success in this business; if you understand the effects of implied volatility and time decay on option prices, you’ll understand our edge in trading. In this article, we’ll discuss option pricing using the Black-Scholes model, explaining how it can be simplified into two concepts: intrinsic and extrinsic value. […]

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