Trading stocks vs options reddit. Day trade options and swing penny stocks.

Trading stocks vs options reddit Options are derivatives — financial instruments that have no value on their own. 75 and the stock goes down to $28, you made your $2. Which one of these three options should I go with I am leaning more towards stocks but I am open to learn more about others Both can be differentiated on a number of factors such as number of available instruments, liquidity, volatility, security, profit potential, market hours and security etc. Don't trade. Options on the other hand decay in value with time (even if price is moving in your favor, you may not be making money or even losing money in some cases), can have big spreads making for a lot of slippage and depending on which options you’re trading you can have issues trying to get in or out of a trade depending on The people who advocate the "can't beat the market so don't try" seem to only bet on stocks which I fully agree. The forex market is open 24/7 and is typically traded on margin, while the stock market has specific trading hours and does not usually involve margin. I always get burned by theta. Futures are superior for day trading the indices but overnight gaps can cost you a lot so I would only recommend for same-day trades Options are great for swing trading specific stocks or the overall market to capitalize on multi-day moves My recipe: day trade SP500 futures, trade stock options for week/month/year holds Welcome to FXGears. you don't need to execute the option/buy the shares. Welcome to /r/StockMarket! Our objective is to provide short and mid term trade ideas, market analysis & commentary for active traders and investors. The stock market is the market for global companies that are listed on the stock exchange and whose prices vary depending on how well or poorly the company is doing. There are a number of things you can to make gains during different market conditions that don’t involve betting on big daily moves. It is much easier to trade options since it is much easier to manage risk than just timing the market trading futures. a $20 stocks that moves 10% is only a $2 move. Where with option purchase you are more aggressive so it comes with high risk. Thus far, I've been able to make the same return in 6 mont You don't have to "give" them anything. Personally I have a hard time with iv and I think it Crypto more aligns with forex trading vs the stock market because it’s for trading currencies. The author argues that stocks have more time and less buying power, while options have more leverage and less time, and gives examples and formulas to compare them. You also get a lot more downside as you described. Instead of viewing it "I can't be profitable in one im trying another". Please correct me if I'm wrong and thank you for any input. For you to sell, there has to be a buyer and vice versa. I cannot trade the US ETF's here from Europe, but futures are however OK. So in the end it largely depends on how liquid the options are for that ticker and your risk tolerance. Welcome to FXGears. Both approaches have their allure, but which one is better suited for different investment goals and risk tolerance levels? Let's delve into the intricacies of each. you do not want to 1256 rules, no matter how long you hold its taxed at 60% long term cap gains and 40% short term, just for an example making exactly 100k daytrading futures is a tax bill of about 8800 vs if it were stocks it would be closer to 20k+ (depending on whether you itemize or take a standard deduction) plus with futures you dont have to worry about pdt rules and wash sale stuff( taxes can obviously be I've been a RE investor for 12+ years now and have quite a healthy portfolio. Reply reply TheMacMini09 I wouldn't touch penny stocks with a ten foot pole. Day trade options and swing penny stocks. I believe Cash App only lets you buy individual stocks, and Bitcoin. I am loosing hope from options trading as i sometimes find it very complex but I don't wanna give up on it and at same time I feel that trading would be more simple if i instead switched to trading stocks for intraday Welcome to FXGears. There’s more to the options vs. Hi everyone, As we know there are many ways and things to day trade. i mean. See their opinions, tips and questions on different markets, platforms and indicators. In the vibrant community of Reddit, the debate between stock and options trading often sparks passionate discussions. Oct 3, 2024 · The main difference between stocks and options is that stocks represent shares of ownership in individual companies, whereas options are contracts with other investors that let you bet on Nov 21, 2023 · If you're thinking of trading stocks or options, it's good to know a thing or two about them. Options are generally not passive investments. Plus, the flexibility to trade 24/5 works well for my schedule. Daytrading futures, forex, stocks, etc. Experienced traders share their preferences and strategies for trading stocks, options and futures. Plus they do optionsits like a chef vs a cook. If you buy the option and the stock goes up (now, before expiration) you make a lot more money. Your loss is now 100x$940. They share their opinions, experiences, and tips on options trading, as well as the risks and benefits of different strategies. It's all about personal preference though, so you do you! PDT is a bitch under 25k but you can a still execute 3 day trades every rolling 7 day period, you can swing trade and you have options trading while you build your account. If you own a stock at $48 and you sell a 50 strike call for $2. Rather than options, you can trade long and short MINI warrants. That's really it. . But if you’re invested in options, the most you can lose is the cost of the option you paid (there are plays which could theoretically cause infinite gains/losses, but for the sake of my point we’ll keep things simple). My thought is that actually "investing" in a stock but also buying a put option that expires, say, in July protects against the most extreme risk -- a market crash not followed by a quick recovery. I’m like an insurance agency. Stocks generally like to go up, and it's a stable movement. Here’s some numbers to put this into perspective: Forex daily trading volume is in the trillions while crypto is in the billions. The right to buy or sell the underlying stocks gives options their value. Yes, this sort of high risk option trade is not standard. Not boomer enough to invest in bonds though! Would never day trade stocks or forex again. if you are long a stock, you are at the mercy of the stock. One of the most interesting parts of the options market is that we don’t need to buy shares of stock or buy options contracts, you can sell them too, even if you didn’t own them in the first place. It is a share of a company. I've never traded options, so know nothing about that. 1 is basically a buy and hold account. Here are a couple of things I would suggest to new option traders: 1) buy calls don't write calls - you should be in the buss of making money 2) trade higher $ stocks, Nflx moved $65 (10%) in 2 days vs. Since 2019, I've been trading Crypto and Stocks. With Options, if you are long on a call and if stock starts to fall you can sell another call or long a put to minimize your loss, this alternative is not available in futures, you have to close your position. penny stocks even though take a hit. A post on Reddit discussing the pros and cons of trading stocks and options in a bullish market. and, I haven't lost any money yet, I'm raking in premium for 8-10% a month. S&P 500 keeps a record of whenever they drop or add a stock to the index, you could make the filter for stocjs on the index in the day if trading. As a beginner, is it logical to start trading with selling cash covered short puts or covered calls? Because according tastytrade: if you have around 2000 to start. I'm sorry you lost cash, but trading is not the casino, you don't winyou make gains bc your using skills not stonk chasing Nov 24, 2021 · We’re talking about stock options vs. I paraphrased from memory of course. But a filter by market cap and/or daily traded volume be likely also work, just be sure to account for daily volume having risen significantly over the last few decades due to more algos trading in Make money trading crypto, invest long term in ETF, selected stocks. Am I wrong? Hi everyone, so I’m going into stocks and i was wondering what is the ups and downs of trading stocks vs trading stock options? I have been trading forex and gold/silver on H4 for about over a year now. Do you think, that mid cap stocks a better alternative to start investing? 2020 - market crashed, all my stop losses on buy/sell side were hit. yes, one option contract is for 100 shares, but option contracts are traded just like shares. Still don't know everything. recently i was introduced to selling put options and the "wheel" strategy and I am falling in love with my baby gains. Stocks have a lot of different kinds of opportunities for daytraders. Lots of the people speaking on the card believe in institutional racism and things like that. youtube. stocks discussion… But I want to focus on why YOU should trade options vs. Since I sell to open and option, I either buy to close the option or it expires worthless. But I encourage you set aside a little bit money that you can afford to lose completely, give options a try. But quickly - yes trading Stock directly is generally preferable when you are Day Trading; however, options can provide great leverage. This is my 4th year of trading and my buy and hold account has by far outperform my trading account. If you buy the stock and it doesn't move, you don't lose anything. I started trading during the Summer so I was lucky to start in a bull-market. Going to start selling covered calls on my positions with 100 or more shares for some side income that I don’t mind getting assigned on as I will be setting the stroke a few dollars higher than my cost basis. I do the opposite. feels good bruh. With options, you will have the entire toolbox". Diversification requires diversity in asset classes and strategies. Especially, since having the options permission seems not to entail having the index and stock options permissions o_O Never bothered to find out myself, as the options permission gave me all I needed Swing Trading is an investment strategy generally characterized by a short time horizon, emphasis on stock momentum, and monitoring both an underlying's fundamentals and technical analysis. sometimes option prices move too fast during a breakout, and you have to buy market, but thats only if you know what you doing most of the time you want limit orders cause man, you are trading stuff, how are you gonna make money with trading if you buy your goods at expensive prices? you should always be trying to get the best deal fo yourself. They make it available immediately for regular stocks, but otc stocks need funds to clear first. If the stock goes to $100, the latter option you get a 100% return. The stock should be through any significant support/resistance (e. Using the /ES (E-mini S&P 500) options. in fact most options are not executed at all. Gotcha, Just wanted to expose myself to the Indices. Thus, it’s extremely competitive; for the most part, to win you have to take money from someone else (of course there are exceptions to this due the different market participants goals). I do not have the shares. A stock is a stock. An option is the right but not the obligation to purchase a stock/sell a stock at a particular price. While it’s apples and oranges, they are both fruits. Or trade different options at different caps with different volatilities from different sectors and develop an intuitive feel for how options work. The stock market does not care your race, your background, or You really need to read the Wiki here, especially the part on Options trading. Most of all, watch them. The main things are no time decay, tighter spreads and ample liquidity. I already have setup DAS for stock trading (equalized risk per trade does not work for contracts), trade ideas platform, and I need to buy a higher level of subscription and addons to DAS to even see the futures tickers. Stocks are a lot more stable to trade. So it's sort of like a married put. Options are great for no PDT, just higher risk so just be disciplined disciplined disciplined with your homework. Simply put, you look at options trades that are being placed and use it to help make determinations about where a stock might be headed (or if it may stay range bound). Just in the last 4 months or so I have spent trading Futures and Forex. I can tell you it is stressful as hell and sometimes even if the stock goes the direction you want you can lose money as the theta decay will crush your gains. It is more logical to start trading options than stocks, if you want to make some money. A call option is basically buying stock on margin, and also buying a put option at the strike price you bought the stock at. The naked option sellers here are almost certain to lose their whole bag eventually. Some call that (and it looks like) an Iron Condor. Trade your own account and DO NOT blindly follow others into a trade. All rigged! Still have substantial crypto holdings, run nodes, provide liquidity and stake. However, in late 2020 I learned how to trade options. The option is worth $10 each. Educate Posted by u/drewjack3 - 1 vote and 5 comments Nobody knows what IBKR is doing there with separate "options" and "stock options" permissions. ----- What is Option Flow Trading? Flow trading is my preferred style of trading. Sounds like it was just not a cultural fit my guy. so im getting into stock options but can't decide if I should go on with it or stay with trading cfd stocks. That’s exactly what it’s about. A Why would I trade options rather than the futures itself, since the options payout is less, given the higher commission? Pros I can think is that the option will not be marked to market overnight compared to holding the contract itself; margin requirement might be lower for the option. you swing trade options just like you swing trade the stock, but doing it with the option is a lot cheaper than with the stock. I often hear 0DTE is so risky. Options and stocks aren't based on the same thing. That way I can trade both sides of the market at the same time (of course that can be done in stocks and ETFs also. But from what I can tell, the best opportunities can be found in stocks IF, and only if, you have the eye to spot them. The option is exercised. What if I learn new theories about the different trading avenues like options and futures. Price limits. Most people on who will say otherwise can't even explain how risk relates to payoff and what risk-adjusted returns are. My other account, I trade options, swing trade and day trade. I like it when price action / candlesticks can easily be read. Image: www. . I "think" what you are doing in selecting the Symbol Lookup for a stock after you have selected "Trade". With an option you are betting a stock goes either up or down depending on type of contract and you are timing it. Hey buddy, just wanted to let you know that I'm really into forex trading these days. com's Reddit Forex Trading Community! Here you can converse about trading ideas, strategies, trading psychology, and nearly everything in between! ---- We also have one of the largest forex chatrooms online! ---- /r/Forex is the official subreddit of FXGears. Will then use that income to buy more stocks. But it's entirely possible to trade this, even as amateur. But the large amount of possible choices can make it chaotic and hard to keep track of. g. You buy car insurance and someone else sells it. Trading futures, options, or futures But if I had to I could swing stock, scalp/swing options, trade futures etc. I still have my membership, didn’t use the options flow or other tools. But also, I'm really curious as to why institutions aren't heavy into it as well, a lot of the volume on SPX comes from institutions, same with SPY I trade stocks and options but I don’t limit a trade to a day. Also, the fact that so many traders are on brokers that don't even offer XSP option trading, a lot of these brokers only recently allowed SPX options trading, webull for instance. To give an example: If stock XYZ was trading at $100, a call option with a strike price of $90 would be ITM since the underlying stock is already above the strike price. On a $100 trade, that's eating 14% right off the top. Why I like Forex better, stronger liquidity. Posted by u/CompulsionOSU - 2 votes and 3 comments A contract, or stock, or whatever you are trading is, well, trading. we can wait for few days to come back to the profit zone. BUT, I feel like if the market starts to correct my call option will pretty much be wiped out when I could've just held the equity. I leg in and out of each trade. Nov 24, 2015 · The very simple answer is that options are much more highly leveraged than stocks. At some point the stock price goes to $1000 each, because AI and quantum. having lost money on penny stocks that put me off the stockmarket for a few years. You can invest it in any of the thousands of stocks, bonds, ETFs, or mutual funds available through the brokerage. Stocks, bonds, commodities, utilizing futures, trading vol, and utilizing options to cap upsided and reduce downside. By learning and using these methods, one can be a “trader” without necessarily being a stock market Get the Reddit app Scan this QR code to download the app now Welcome to FXGears. Example, 50 calls with your <30 DTE on a stock worth $50, strike $50, each for $1, total speculated $50, vs 1 share of same stock worth $50 held for 30 days. I trade options on a regular basis just for fun. Forex is too manipulated and random, and is very easily affected by news and geopolitical events. My mind has been blown at the monthly yields I've been able to obtain on my cash in the market vs my rental portfolio. Stocks & bonds can go to zero too, but only if the underlying business fails. I could find the perfect setup for a company, but option volume is "3" lol. There are two kinds. swing trading. I recommend learning about the greeks before jumping into options and learning about spread too. 8M subscribers in the Daytrading community. One saying goes:"Trading stocks is like having a screwdriver. If I am good at it I want to do it full time. And if the company ever goes bankrupt and the stock goes to 0, then you lose it all. The stocks that I want to hold for years and years I will be buying after the next major dip. Options expire, so if the conditions aren't met within the timeframe, the option is worthless. com Understanding Stocks and Options Stocks… it's based on what you know and timing. the profits can easily come newbie here but what iv’e learned options can kill you if a stock starts going sideways, what best worked for me considering its faar more riskier then standard options (calls/puts) is trading knockouts, super risky but more predictable cuz they won’t kill you when a stock starts barcoding! made 10x gains entering trade on tesla couple days With a stock, you’re paying full price per share. Options trading can be done purely on Technical analysis, no view needed on macro or underlying fundamentals, & Option trading is free on most platforms. Your post is a rant, not a review. If you are making that with shares already then yes you can do it,I don’t even know much about the options and been doing it with small account playing and 20 percent can happen all the time,way more also in this market and the coming market. Usually when I hear day trading though, people are referring to options, forex, futures, or penny stocks, but I rarely hear of anyone day trading stocks, more specifically, safer, blue chip stocks such as AAPL or MSFT. Hi Smart_Field_3002. lol that alone makes it harder. I always buy the stock on margin and buy a put option, sometimes 2-3% out of the money. When you short a stock you open a trade by selling first, normal stocks: buy for $100 > sell for $110 =profit of $10 You can do personal options trading one of two ways: Learn the Greeks and rely heavily on them. why do you guys prefer options over the cfd? comments sorted by Best Top New Controversial Q&A Add a Comment It seems like the P/L within these ETF's is near some of those riskier tech stocks and since these ETF's have 5+ years of data it is easier to predict the market swings and their support and resistance level. ) Selling a Put spread and, at the same time, selling a Call spread. I find the fast-paced nature and global market of forex more exciting and rewarding. com, a trading forum run by professional traders. However since calls and puts are essentially opposite, a put with a strike price of $90 would be an OTM put in this scenario. Options. I feel comfortable and knowledgeable in the stock market, but the benefits of forex seem attractive. They usually take on a stupid amount of risk, get lucky, then think they know how to trade because they beat the S&P by 2x while taking on 4x the risk. actual stock ownership. If a stock is trading at $20 and you think the price will go up, you can buy call options with a $22 (or however high you think it will go) strike price for a premium (the price of the option). You put money into your account at the brokerage but it is still your money. usually the stock, the stocks "options" or the stocks Options "Chains". Forex vs Stocks Trading Reddit First of all, we are going to see very quickly what both markets consist of. You own a chunk of the company when you own stock. I am 18 and I don’t have school for 9 months, I want to test the waters with day trading. 95 per otc trade. And there are also more conservative (and not so conservative) option trades one can make as well. Ticker pool & liquidity are other considerations when deciding Futures vs Options trading. the buy and hold stocks trading strategy is similar to the swinging strategy used in options except the options rely on you being ahead of the curve and purchasing a contract when the price is in your favor along with the supporting volume. I'm worried that holding stocks on margin is unsafe and I should just resort to a call-option with a 3-4 month expiration. I have 2 accounts. It's my preferred choice over stocks and options. I see many comments discouraging you to try options, that's probably fine advice. If market timing is your only form of risk management, then futures are definitely easier since the contract is very near |delta| = 1. I rarely buy call options anymore. I do have some money in an equities account (but not $25,000) so I will occasionally do a stock trade and hold it for a few days, but mostly I trade futures. I like to sell put options on stocks and if you get assigned you can hold the stock as long as you want…not so with futures options…some are monthly while others are quarterly so the clock is ticking if and when you get assigned…you have to square away the position before the contract expires…that added extra stress for me. So you have $400 in non otc stock buying power. stocks. With options you get a lot more leverage on that play. option scalping is kind of like scalping shares on margin/leverage. I see a lot of people trade ES, but I like trading YM. As you can see options are more expensive tool, they can be useful when you are confident about price movement and crucial when you make mistake. Bro, options trading is a whole different ball game compared to straight-up stock trading. Volatility sucks, so forex sucks. If we are talking about sustainability long term options are hands down better especially when you add in things like covered stock positions and naked short options. Mostly stocks and a small account for options trading. So with stock purchase you are more flexible to make a mistake with proper risk management. Mini warrants have leverage but no margin calls, a built in stoploss, a guaranteed market, and the trading cost is plain brokerage eg $10 with CommSec. Edit: please let me know if there is any broker that offers stock options on mt4/mt5 The forex market is a global market for the trading of currencies, while the stock market is a marketplace for buying and selling company stocks or shares. Posts about equities, options, forex, futures, analyst upgrades & downgrades, technical and fundamental analysis, and the stock market in general are all welcome. Let’s say the premium is $0. The issues is actually like most people say iv so when you trade an options especially odte they can decrease in price even though the underlying is moving in the correct direction then the option price could move back to breakeven even if it is a major move not so with futures. I took all the learnings whatever was available at my disposal. If you are long on a stock, the only options you have are to book profit or loss if the stock goes up or down, there is no option 3. Still a newbie though. Sometimes option scalping is great, but sometimes the contracts are very spready vs the actual stock spread. Also, just an fyi, TD charges $6. Stayed on the discord until they decided to join the “woke” crowd. I have a broker which allows me to trade stocks exactly the same as with forex. I used to read a lot! I learned that every big market moves - up/down are great opportunities. I had saved some money. Personally, I prefer forex over crypto since it's a more regulated market, is highly liquid and offers benefits from leverage etc. View it like "I need to improve my trading psychology as I fail at trading stocks. Posted by u/Itchy-Tell2811 - No votes and 12 comments Otc stocks need funds to have cleared in order to be bought. Specifically I sell options instead of buying options. Trading Futures intraday is more expensive (brokerage) compared to Options. As a stock trader who moved over to options, I use the wheel strategy that may use stocks as part of how it works, but if you use the right stocks for you it can be pretty close to swing trading on steroids. If it doesn't go up before expiration, you lose everything. All options have an expiration date. In the case of most options trade, it's up to you to win or lose that trade. I learned fundamentals while I was trading by reading books, watching videos. I wait patiently for entries, set stop losses at break even, so i never lose money, and I prefer dividend stocks. Just be patient and do your homework and you'll get there. It isn't based on anything. 25*100 shares that the option represents). It seems to me that any gain porn I've ever seen comes from people becoming millionaires in the space of 1-3 years by trading options. The best thing with options is when done right you limit capital requirements, and can make money based on your outlook on the market or specific stock. let alone XSP. Here we will walk through the pros and cons of options vs stocks. I wish I had your money we’d be millionaires by year end. It all depends on how you use them - there are Option spreads that can mitigate risks, there are Option plays that can maximize You are looking for the following attributes in the stock you are want to Day Trade with Options: Strong Intra-Day Chart - Ideally you want a stock that is strong vs the market (SPY) or weak vs the market (SPY), depending on if you are doing calls or puts. options in hands of people without DEEP POCKETS = suicide, remember if you loose money on options selling SEBI can take everything you own !!! stocks can be low risk low reward if you dont be stupid and use leverage. Being relatively new to stocks and trading, I've bought into a few stocks here and there but the only feasible way to great gains (and equally great losses) is through options. I posted this a while back and you might find it useful - The Wheel Strategy (ScottishTrader) Looking at your past performance, do you find yourself more profitable from trading options on individual companies vs index? Note: one main drawback from individual stock is option volume. Like your penny stock chasing and they do blue chips. They had a booth at Investfest in Atlanta. FUTURES/OPTIONS/CRYPTO TRADERS WELCOME! No one has explained this yet so let me do it. Once the system finds the stock Symbol you entered it presents you with a choice as to what you want to trade. My view is options trading cannot ever qualify as value investing as it fails the core test: safety of the principle. A user asks why they should buy options instead of stocks, and gets various responses from other users on r/options subreddit. Remember that crypto in the past goes very cold over the winters between runs. 25 — that call option will cost you $25 ($0. 2. Better tax wise than trading stocks. with options, you've got all these sick tools and strategies at your disposal, like analyzing probabilities of being in the money or out of the money, rolling positions like a boss, and using Greeks to fine-tune your trades. Well I have been trading options for about 1 year now and I had a loss of around 70k till date. Could I please get an unbiased and honest opinion on the forex market vs stock market and, what’s more suitable for a small but dedicated trader. 75 from the option and you lost or are down $20 on your stock. bbnr svnea cnvxdm mshyo xfnvus ikpgv clnhrun vomb zsgo nxgeezs wovkaw vti bsjr zfoyn fglpjoe