As we hear either from financial management book or seminar from financial gurus, it often mentions that we should not put all the eggs into one basket. The point is if the basket is leaking down and the hole is getting bigger and bigger, it end up the egg will fall down.

This is what happens if we put our money in US stock market and expect the market goes bullish in order to make profit, we might have to hold our breath for a moment because market might go sideways or even bearish for few months or a year. However, if we know how to make profit by using Option Trading Strategies, we can get advantage in bi-directional market meaning to say we can still make profit when market goes either bullish or bearish.

Safe Trading Always;


Bearish Pattern Trader
http://www.option-trading-secrets.com/

The stock market will eventually recover, and today's gains are evidence of that. However at this point I recommend staying out of stocks & investing in something else.

yeah I agree, we should invest on other investment program at the meantime so that our money isn't frozen waiting for stock market to recover. For sure there are investment program out there which is a lot better than on the stock market.

Which other investments are you looking at Piper ??

Right, there are continuous fluctuations in the stock market. It is necessary to make the effective and consistent trading strategies.

If their is a sustainable (meaning low commissions) "market" for derivatives such as options then it doesn't matter if the market is flat, up or down. There is an option strategy for each of them (Calls, Puts, Bull Call Spread, Bear Put Spread, Straddle, Strangle, Butterfly etc)

The only problem is the intrinsic value of the option and time decay, as options depreciate quite quickly meaning they will become worthless. If you're trading American-type options you should be fine, but FX Options is usually dealt with a european style excerise)

That is something to think about.

yeah i also agreed with that...

Not great advice, you can ALWAYS make money in the stock market. It depends on your education!

Investors of ETF Funds can take advantage of their use to protect their holdings conservatively.
If you wish to secure profits from a recent run-up in an ETF without selling the position and triggering taxes or you wish to buy insurance against a drop in a unsteady market, these and other defensive strategies can be acquired with the nearly 70 ETF options currently available. Although many large stocks offer options, trying to engage in many at once becomes a nightmare of expense, tracking and paperwork. EFTs make defensive options easy.


Cheers
Jonathan

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mark
mcse

Options can be great if used properly. They have lots of leverage though - so you must be careful.

I think the best way to use them is to sell them against your long term holdings > Covered Calls