The "daily Call" From Option Alpha: Options Trading | Stock Options | Stock Trading | Trading Online

#8 - What Are The Best Strategies For New Options Traders?

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Synopsis

Hey everyone, Kirk here again at Option Alpha. In today's daily call, I want to talk about the best option strategies for new traders. I think there's a couple of strategies that you can really focus on if you're brand new or if you're fairly new to getting started in options trading. I think the first general theme behind the best strategies I think is all risk-defined. As you’re starting out, you don’t want to do anything undefined risk. What that means is you don’t want to do anything naked option selling. Even naked option buying is really a bad idea. Even though it’s not like a naked position, but you’re just single leg buying options or selling options, probably not the best thing you should do. I definitely suggest you should go with more of the spread type strategy where you’re buying one and selling the other. The reason is because you can control your risk a little bit more. It is risk-defined, it is profit-defined, but you know exactly what you’re getting for those positions. When you actually plac