The Fundamental Principles of Binary Options

Binary options are a relatively new trading experience which has attempted to make the world of options trading available to everyone. The concept is simple and distances itself from the complex and expensive world of traditional options trading by allowing traders to invest in low-cost options and with returns guaranteed at around 80%. What are Binary Options? Binary options allow money to be made by simply choosing whether...

Introduction To Stock Options

Introduction To Stock Options By: PromptTrader A stock option is an investment tool that represents a contract between a buyer and a seller.  Specifically, an option is a contract that gives the owner the right, but not the obligation, to buy or sell a given stock at a specified price on or before a specified date.  Options also exist for future contracts, foreign exchanges and other instruments. However, this article will...

Using Stock Options To Hedge Your Long Positions

What is Hedging? Hedging in is a term used to describe an action that is taken to protect your current investment against loss through a price movement that would outcome your profits negatively. Introduction to Hedging Hedging is a very important tool for professional stock traders, especially investors. This may be one of the key tools that enables stock traders to carry on year after year. The word Hedging comes from the...

The 7 Factors That Determine Stock Option Pricing

Now that we’ve gone over the basics of stock options in our previous article Stock Options 101, it’s time to get a better understanding of how option prices change. There are in fact seven major factors that determine the pricing of a stock options 1. Current Stock Price – This is only logical. Supposed you’re interested in buying a stock that’s currently trading at $40. If you purchase a call option...

The Importance of Learning to Trade Stock Options

Learning to trade with stock market options isn’t as straight forward as you may think. If it was, then everyone would be doing it. Good online traders can earn lots of money and can be very precious to a company for its profits. Some companies will even insure the key person for huge sums of money due to their high value. You need to take your time and learn before you start. There are plenty of online websites where...

Binary options trading

In the previous tutorial for stock options, we explained in short what stock options are. However, recently another type of stock option has started to become widely popular. These are the binary options. As opposed to the regular stock option, where the price of the stock option is directly connected to the price of the undnerlying stock and the distance of the expiration date, a binary option is a type of option where the...