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Increase Your Profits With Options
02-14-2018, 04:40 AM
Post: #1
Big Grin Increase Your Profits With Options
Lots of people think Options are only for professional traders and the big guys. It is not. I'd like to explain essentially what're the pros and cons of options.

This is how the choice works. Assume that you view a house in your road and the owner is likely to provide it retiring and moving to Florida within twelve months. The current market price for the...

I know many people who trade stocks. For more information, please consider checking out: in english. All of the US home holds have stocks in several companies. Have options be tryed by you?

Many individuals think Options are merely for professional investors and the big guys. It's not. Allow me to explain in simple terms what are the pros and cons of options.

Here is how the choice works. Assume that you view a house in your road and the dog owner is likely to offer it retiring and going to Florida within one year. The current selling price for the house is $215,000. You go and talk to the master Brad and tell him Hi Brad; I would prefer to lock in this house for the price of $220,000; I'll have the proper to buy this house for this price for 12 months (i.e. till December 2006). For this I will pay you $2000.. Now you and Brad come to an Brad gives you the right however, not an obligation to purchase the home till December 2006 at a price of 220,000. You've the best and perhaps not the duty that's important this means if your house price decreases you dont need to buy it at 220K.

Now in end of 2006, the house costs came out and now Brads house is now worth $235,000. Now you call a real estate agent sell it for 235,000 and give 220,000 to Brad and pocket a of 15,000 (minus your option premium of $1000). So your net income is $14,000 on an investment of $1000. That is like 1400% return on your money.

If you had bought the home at 215,000 and sell it for 235,000 you could have made 20,000 or around 10% return on your money.

The choices trade is discussed in the author's website completely with examples. We encourage the users to start getting more income and read the example..
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