Sell puts to be assigned stocks, sell calls to get them called away. No memes or gain/loss posts (outside Saturday) 6. For someone new I would completely stay away from options until you have experience and learn all the mechanics. Whether you’re an investor looking for the latest stock news or a parent searching for the most honest reviews, there’s a subreddit for you. It goes without saying maybe, but it’s a lot safer to jump into trading stocks with only a little knowledge than to jump into trading options. Based on your risk tolerance and your own dd, you can buy relatively safe calls or puts.
No penny stock pumps, yes, we can spot them easily.
Press question mark to learn the rest of the keyboard shortcuts. Company profile page for Reddit Inc including stock price, company news, press releases, executives, board members, and contact information Edit: sent you a YouTube playlist of videos that should probably explain things well enough. Don't hesitate to tell us about a ticker we should know about, but read the sidebar rules before you post. 8. I watched many YouTube videos, and still can't fully understand what options are. Writers / Sellers are the insurance company, selling you a contract that guarantees you a payout in case of an accident but you pay a premium. Something that hasn’t been mentioned yet is that options are similar to taking a leveraged position in a stock. Buyers are the driver, who purchase the contract for premium BUT if an accident happens you were guaranteed a payout so you're good to go. If the stock goes your way your returns are enhanced but if it goes against you, you lose everything. Check out our wiki and Discord! if you think a stock will go up, you would purchase a call option which would allow you to buy 100 shares of Ford, for example, at $4 (the agreed upon price of the option contract), and sell at the current market price of $6. All an option is is a contract that allows you to buy 100 shares of a stock at a certain price at some point in the future, be it a week out or in one year. Cookies help us deliver our Services. Sarah Ponczek, September 15, 2020, 6:00 AM EDT Professional investors turn to Reddit, Twitter to track retail If you dont crash before the contract ends, they keep your premium AND that sweet payout money. 6. Sellers don't want you to get in accidents before the contract expires. That’s how people can make so much money trading options, and that’s what is meant by derivatives, and is also what makes them so potentially dangerous. 4. This is how my weird brain got the idea of premium and the buying/selling part for the first time. Options take much more active managing and care, and have worse expected returns over time. The difference being a rise in $.50 in ford stock would translate to something like a $50 increase in the price of your options. This is in no way a "good" explanation of options but it helped me understand at least one principle. If Ford is trading at $2/share the day your $4 call option expires, nobody is going to pay for a contract that allows them to buy 100 shares at $4/share and sell for $2/share, that doesn’t make sense. So it’s entirely possible to lose your entire initial investment in the option and be left with nothing. But if you get lucky and play your cards right, you can make a lot of money. Artificially pumping tickers is forbidden. Both. Options are contracts that you buy or sell in order to either buy or sell a 100 shares of a stock at a certain price.
If you are buying options, there is a good chance with each chunk of money you put in that the whole thing goes away. Images MUST be penny stock related. Post your opinions and analysis on stocks, bonds, futures and ETFs with the reasons why you like them. r/stocks: Almost any post related to stocks is welcome on /r/stocks. Those who are looking to buy shares in the company, however, may be disappointed. Thinking of buying stock in Reddit? I personally love the covered call and cash covered puts approach. Tada, you just bought 100 shares at $4, and sold at $6, $2 profit per share! Apr 11, 2020, 2:59 pm* Tech . The problem I feel is you’re not actually invested in the company like you are with stocks, you’re basically only interested in watching the price of your option go up, which is directly tied to the price of the stock.
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