Key Points: 

  • 7 Options Tips for beginner options traders
  • Insights and examples to use

7 Options Trading Tips 

In this post I discuss 7 options trading tips.

There are a lot of ways to trade options and out of all the financial products to trade these might be the most confusing and hardest to understand. But, like most things, you can simplify it and the art of doing that is key to learning to make money trading options. I try to share these tips as a way to give guidance on this as I know the struggles.

The 7 tips I discuss in the video above:

1. Two ways to pick better strike prices

2. How to get better fills

3. Focusing on downside risk

4. Avoiding high implied volatility

5. The right times to place trades

6. Start trading index ETFs

7. My BEST advice for options traders

Index ETF Options

I really like this for beginner options traders or even advanced traders, whatever that even means, as a way to learn and strategy. Index ETF options are liquid markets and the amount of variables that are required to trade them are small in comparison.

This is a strategy I advocate for in the S.A.T. (Small Account Options) course and it makes it simple and direct. One of the beliefs I hold is that when you are learning options that you need to start making money first and as you make money you can explore other strategies. It’s no fun learning for 2/3 years before you start making money and the S.A.T. strategies are designed to get people moving on live trading quick.

Now you can learn and expand as you wish during your journey, and you should, but keeping it simple to start is the key.

 

My Personal Strategies (I did not discuss in the video)

I run a combination of options strategies but the main one is trading volatility on high-beta stocks and using SPY/QQQ short-term options to scalp. There are time where I trade LEAP options but those are usually reserved for very long-term ideas or situations where I want to speculate on a stock. But, my regular everyday strategy is just trading volatility.

I also don’t mind using OTM calls or puts on highly assymetric bets. Read this post on that here.