If you are new to options you probably have asked your self why do you want to trade options. You have heard of people making huge amounts of money trading for living. The language of trading rolls off their tongues as smoothly as a downhill sled on ice snow. And they make it sound so easy.
And to a certain degree that is true.
Options trading is not especially difficult. Of course they are basic concepts to learn and capital to be used.
But if you think you are going to make a huge amount of money right out of the gate, I would caution you to reconsider. While some traders do get lucky early in their trading careers more often than not the really successful traders learn the craft our a long period of time.
They study markets and get a sense of the price movement in stocks they want to trade. They learn about options contracts, puts and calls, liquidity, implied volatility, strategies. They learn how to preserve their capital and not trade too big.
I have heard Tom Sosnoff, the founder of tastyworks say many times that the number one reason traders fail is size. They put on trades too big for their account and end up loosing their money when the trade goes against them and they didn’t have the know how to manage the trade.
But this doesn’t have to describe you.
I like to look at trading as a skill you want to get good at over time.
You like to learn new skills and with the proper amount of dedication and care you can progress slowly toward your goals.
Dr Jim Schultz another tastytrade personality says that as a new trader you should spend your first six months learning as much as you can about the skills you need to put on effective trades. Always trade small and don’t get in over your head.
So take your time and get good at your craft. Learn the basics. Get good at one or two strategies. Paper trade a couple of markets are see how a trade plays out.
Soon you have the confidence to make solid trading decisions nd you’ll be glad you put in the time and effort to learn this valuable skill.
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