If you’re looking for a way to increase your money-making potential, investing in options may be the right move for you. Options give you the ability to buy or sell a security at a set price before it’s actually traded on the market.
This gives you the opportunity to make money if the price of the security goes up or down.
There are three types of options: call options give you the right to buy a security at a set price by a set date, put options give you the right to sell a security at a set price by a set date, and straddle options give you the right to buy or sell two securities at the same time.
Generally, call options are more expensive than put options and straddle options are more expensive than call and put options combined. The farther out in time you want to expiration date, the more expensive the option will be.
When deciding whether or not to purchase an option, it’s important to consider your risk tolerance and your investment goals. You should also consider whether or not the option is available at a good price.
Finally, make sure you understand how an option works before purchasing it.
