If you are thinking about Futures, I would go with ETF (electronically traded funds) or mutual funds that hold futures. Futures are very hard to trade, and can be very risky. I have been in the business of giving advice for a while, and I would rather put my clients in something that has a solid money manager (mutual fund that buys futures) and a proven track record in all types of markets. So if the market turns suddenly, you don’t lose 100% of you investment (options). You can make the same amount of money with a beta (risk to the market) that is fairly low.
Options & Futures give you:
– the right to buy something (a stock, corn, real estate, etc)
– within a specified time frame
– at a specified price
So, I could buy an option to purchase yahoo stock. It breaks down like this
– 100 Yhoo shares
– Jun 07
– $30
So for $85 (as of May 22) I can buy the right to purchase 100 shares of yahoo anytime between now and Jun 15 2007, for $30 per share.
If the price of yahoo goes up, I can profit. If it does not, I lose the $85. (If I don’t resell the option, and it expires on Jun 15.)
Using the Mtpredictor’s technical analysis Elliot Wave Principle software, Bsmtprediction provides Forex Traders with FREE access to AUD/USD, EUR/GBP, GBP/USD, EUR/USD, NZD/USD, USD/CAD, USD/CHF, EUR/JPY, GBP/JPY & USD/JPY daily currency forecasts through this website. At Any Time / Any Day (we’ll straight away post the signals here in real-time if there’s any triggered) 1 hour, 4 hours & daily time frame forecasts are published on this site. The predictions are good from the moment they are published until either it reached the take profit target, hitted the stop loss or another new prediction of the same currency & timeframe unveils on the same / following day. Essentially, the prices shown are for an unknown period.. That’s why we encourage you to subscribe our FREE Google Groups newsletter to get the latest signal updates sent to your e-mail from the very 1st minute it surfaces the net..
More or less, they are the same as stock trading. You’re familiar with stock trading, right? That’s where you buy or sell some amount of ownership in a company.
Options and futures are just different “things” that you can trade. A more technical term in instrument. There are lots of instruments that you can trade: stocks, bonds, futures, options, wheat, corn, cotton, copper, steel, gold, currency, etc.
Check out wikipedia for more thorough explanations of what different instruments are.
4 Responses to “What Is Options Trading And Futures Trading?”
If you are thinking about Futures, I would go with ETF (electronically traded funds) or mutual funds that hold futures. Futures are very hard to trade, and can be very risky. I have been in the business of giving advice for a while, and I would rather put my clients in something that has a solid money manager (mutual fund that buys futures) and a proven track record in all types of markets. So if the market turns suddenly, you don’t lose 100% of you investment (options). You can make the same amount of money with a beta (risk to the market) that is fairly low.
Options & Futures give you:
– the right to buy something (a stock, corn, real estate, etc)
– within a specified time frame
– at a specified price
So, I could buy an option to purchase yahoo stock. It breaks down like this
– 100 Yhoo shares
– Jun 07
– $30
So for $85 (as of May 22) I can buy the right to purchase 100 shares of yahoo anytime between now and Jun 15 2007, for $30 per share.
If the price of yahoo goes up, I can profit. If it does not, I lose the $85. (If I don’t resell the option, and it expires on Jun 15.)
Using the Mtpredictor’s technical analysis Elliot Wave Principle software, Bsmtprediction provides Forex Traders with FREE access to AUD/USD, EUR/GBP, GBP/USD, EUR/USD, NZD/USD, USD/CAD, USD/CHF, EUR/JPY, GBP/JPY & USD/JPY daily currency forecasts through this website. At Any Time / Any Day (we’ll straight away post the signals here in real-time if there’s any triggered) 1 hour, 4 hours & daily time frame forecasts are published on this site. The predictions are good from the moment they are published until either it reached the take profit target, hitted the stop loss or another new prediction of the same currency & timeframe unveils on the same / following day. Essentially, the prices shown are for an unknown period.. That’s why we encourage you to subscribe our FREE Google Groups newsletter to get the latest signal updates sent to your e-mail from the very 1st minute it surfaces the net..
More or less, they are the same as stock trading. You’re familiar with stock trading, right? That’s where you buy or sell some amount of ownership in a company.
Options and futures are just different “things” that you can trade. A more technical term in instrument. There are lots of instruments that you can trade: stocks, bonds, futures, options, wheat, corn, cotton, copper, steel, gold, currency, etc.
Check out wikipedia for more thorough explanations of what different instruments are.