http://www.options-trading-education.com/24078/options-trading-mistakes-to-avoid/ Options Trading Mistakes to Avoid Making money in options trading has to do with picking the right trades and avoiding several basic mistakes. We would like to offer up a handful of options trading mistakes to avoid. These include  Limiting yourself to out of the money call options  Working with a single all purpose options trading strategy  Not having a clearly defined exit plan for all trades  Changing your trading strategy in a moment of greed or panic  Trading options on equities with poor liquidity  Forgetting about dividends You can make money buying options and you can make money selling options. And you can lose everything with a couple of bad trades. Here are our thoughts on options trading mistakes to avoid. Options Trading Strategies There are many potentially profitable options trading strategies. There are two basic options trading mistakes to avoid in regard to trading strategies. One is that if you are working with a strategy appropriate for the situation stick with it. The other is that not all strategies are appropriate for all markets and all market conditions. Some traders only focus on buying calls on out of the money options. This can be very profitable when the underlying stock goes up substantially in price. Unfortunately, out of the money options are out of the money for a good reason. A lot of smart people have decided that the stock in question is going nowhere. There is a lot more opportunity in the options market than just looking for promising out of the money call contracts. In a very volatile market a popular strategy is a long straddle. The trader buys both a call and a put on the same stock with the same expiration date. The rationale is that if the market is very volatile it is bound to go up or down sufficiently to render a profit in one direction or the other. However, in a more normal market there is typically only one direction in which a stock is likely to go and in those cases one is simply wasting money on buying either the put or the call. This is one of the common sorts of options trading mistakes to avoid because it simply increases the overhead of trading that you have to surpass in order to gain a routine profit. Picking an Exit As You Enter Greed and fear are the eternal enemies of all traders. Two of the most common options trading mistakes to avoid are staying to long in a trade and losing a profit and getting out too late and absorbing big losses. When you go into a trade you should have a precise plan for getting out. If you will be happy with a thirty percent profit on your trading capital then get out of the trade when you have that. Likewise if you are willing to absorb a thirty percent loss and no more, get out before your loss gets worse. Otherwise fear and greed take over and there go your profits.

1. Options Trading Mistakes
to Avoid
BY: WWW.OP T IONS -TRADING-EDUCAT ION.COM

2. By:
http://www.options-trading-education.com/24078/options-trading-mistakes-to-avoid/
Making money in options trading
has to do with picking the right
trades and avoiding several basic
mistakes.

3. By:
http://www.options-trading-education.com/24078/options-trading-mistakes-to-avoid/
We would like to offer up a handful
of options trading mistakes to
avoid. These include

4. Before We Continue…
Click the links below to get your
FREE training materials.
Free Weekly Investing Webinars
Don’t miss these free training events!
http://www.profitableinvestingtips.com/free-webinar
Forex Conspiracy Report
Read every word of this report!
http://www.forexconspiracyreport.com

5. By:
http://www.options-trading-education.com/24078/options-trading-mistakes-to-avoid/
Limiting yourself to out of the
money call options

6. By:
http://www.options-trading-education.com/24078/options-trading-mistakes-to-avoid/
Working with a single all purpose
options trading strategy

7. By:
http://www.options-trading-education.com/24078/options-trading-mistakes-to-avoid/
Not having a clearly defined exit
plan for all trades

8. By:
http://www.options-trading-education.com/24078/options-trading-mistakes-to-avoid/
Changing your trading strategy in a
moment of greed or panic

9. By:
http://www.options-trading-education.com/24078/options-trading-mistakes-to-avoid/
Trading options on equities with
poor liquidity

10. By:
http://www.options-trading-education.com/24078/options-trading-mistakes-to-avoid/
Forgetting about dividends

11. By:
http://www.options-trading-education.com/24078/options-trading-mistakes-to-avoid/
You can make money buying
options and you can make money
selling options.

12. By:
http://www.options-trading-education.com/24078/options-trading-mistakes-to-avoid/
And you can lose everything with a
couple of bad trades. Here are our
thoughts on options trading
mistakes to avoid.

13. By:
http://www.options-trading-education.com/24078/options-trading-mistakes-to-avoid/
Options Trading Strategies

14. By:
http://www.options-trading-education.com/24078/options-trading-mistakes-to-avoid/
There are many
potentially profitable options
trading strategies. There are two
basic options trading mistakes to
avoid in regard to trading
strategies.

15. By:
http://www.options-trading-education.com/24078/options-trading-mistakes-to-avoid/
One is that if you are working with
a strategy appropriate for the
situation stick with it.

16. By:
http://www.options-trading-education.com/24078/options-trading-mistakes-to-avoid/
The other is that not all strategies
are appropriate for all markets and
all market conditions.

17. By:
http://www.options-trading-education.com/24078/options-trading-mistakes-to-avoid/
Some traders only focus on buying
calls on out of the money options.
This can be very profitable when
the underlying stock goes up
substantially in price.

18. By:
http://www.options-trading-education.com/24078/options-trading-mistakes-to-avoid/
Unfortunately, out of the money
options are out of the money for a
good reason. A lot of smart people
have decided that the stock in
question is going nowhere.

19. By:
http://www.options-trading-education.com/24078/options-trading-mistakes-to-avoid/
There is a lot more opportunity in
the options market than just
looking for promising out of the
money call contracts.

20. By:
http://www.options-trading-education.com/24078/options-trading-mistakes-to-avoid/
In a very volatile market a popular
strategy is a long straddle. The
trader buys both a call and a put on
the same stock with the same
expiration date.

21. By:
http://www.options-trading-education.com/24078/options-trading-mistakes-to-avoid/
The rationale is that if the market is
very volatile it is bound to go up or
down sufficiently to render a profit
in one direction or the other.

22. By:
http://www.options-trading-education.com/24078/options-trading-mistakes-to-avoid/
However, in a more normal market
there is typically only one direction
in which a stock is likely to go and
in those cases one is simply wasting
money on buying either the put or
the call.

23. By:
http://www.options-trading-education.com/24078/options-trading-mistakes-to-avoid/
This is one of the common sorts of
options trading mistakes to avoid
because it simply increases the
overhead of trading that you have
to surpass in order to gain a routine
profit.

24. By:
http://www.options-trading-education.com/24078/options-trading-mistakes-to-avoid/
Picking an Exit As You
Enter

25. By:
http://www.options-trading-education.com/24078/options-trading-mistakes-to-avoid/
Greed and fear are the eternal
enemies of all traders. Two of the
most common options trading
mistakes to avoid are staying to
long in a trade and losing a profit
and getting out too late and
absorbing big losses.

26. By:
http://www.options-trading-education.com/24078/options-trading-mistakes-to-avoid/
When you go into a trade you
should have a precise plan for
getting out. If you will be happy
with a thirty percent profit on your
trading capital then get out of the
trade when you have that.

27. By:
http://www.options-trading-education.com/24078/options-trading-mistakes-to-avoid/
Likewise if you are willing to absorb
a thirty percent loss and no more,
get out before your loss gets worse.
Otherwise fear and greed take over
and there go your profits.

28. By:
http://www.options-trading-education.com/24078/options-trading-mistakes-to-avoid/
Basic Options Trading
Mistakes to Avoid

29. By:
http://www.options-trading-education.com/24078/options-trading-mistakes-to-avoid/
Do not get into a situation where
you cannot get out of a trade. This
is what happens when you trade
options with poor liquidity. Avoid
these situations at all costs.

30. By:
http://www.options-trading-education.com/24078/options-trading-mistakes-to-avoid/
And, remember that lots of stocks
pay dividends. The value of your
options contract will change
dramatically when the dividend has
been paid.

31. By:
http://www.options-trading-education.com/24078/options-trading-mistakes-to-avoid/
Remember to calculate dividends
when trading stock options.