Understanding Stock Options Trading and Technical Analysis Basics

For monthly updates containing new options trading information and articles, as well as current technical analysis trends, subscribe to our Newsletter below!
:

:


"I've always been confused about options trading... at least now I have a better understanding about it!"

Ben Masters
VIC, Australia



Welcome to the Option Basics Guide!

Before continuing, we need to emphasize that options represent a higher-level form of investment, and carry a much higher amount of risk. As such, investors are advised to thoroughly understand and learn stock options before investing, and to only invest with risk capital.

Prior to buying or selling an option, a person must receive a copy of Characteristics and Risks of Standardized Options (ODD). Copies of the ODD are available from your broker, by calling 1-888-OPTIONS, or from The Options Clearing Corporation, One North Wacker Drive, Suite 500, Chicago, Illinois 60606.

Easy-speak Stock options are more complex and risky than stocks. Carefully study and learn stock options before investing. Also, only invest with money that you can afford to lose.

This guide helps you learn stock options in the American stock market. The properties and rules in trading options defer from country to country. If you wish to learn stock options in a different country, the option basics from this guide still apply, but you are advised to consult your local Options Exchange for details.

This guide assumes that you already have a basic understanding of the stock market. If you need more information on that, you can read Investopedia's stock tutorial here.

The topics covered in the Option Basics Guide are as follows. You can click a title to jump directly to that topic, or click the "Next" button below to start with the first topic.


Topics in this Guide
  1.  What are options
  2.  Calls and puts
  3.  Options lingo
  4.  Option strategies
  5.  Straddles
  6.  Covered calls
  7.  Spreads


1. What are options

Bookmark this page

All stock options trading and technical analysis information on this website is for educational purposes only. While it is believed to be accurate, it should not be considered solely reliable for use in making actual investment decisions.
Copyright © 2004-2008 Option Trading Guide. All rights reserved.