Originally Posted by
JamesBond
Start by trading covered calls. You cannot lose money. (Standing by for the arguments about that, but I will win them). After you learn to do covered calls, try cash secured puts. Then branch out into naked calls and puts. I think I already said it, but all that exotic crap you hear about.. condors, butterflies, straddles, strangles... is a waste of time and money. And the best thing I ever read about options is that you never make money buying anything. Find the right horse, and it can be a very lucrative ride
dyodd, ymmv, etc etc
I thoroughly disagree with you here, saying that spreads are a waste of time and money. Assuming you understand them and know how to manage them they’re far more capital efficient than your typical covered call. If I can buy a cheap wing for say, .25 and preserve $2-$3k in buying power, this allows me to do a lot more with my buying power versus devoting all to a few trades. The key is trading small and trading often to tip the probabilities in your favor.
however, I prefer naked puts to maximize my premium and for management purposes. It’s much easier to keep rolling a naked put and collecting premium as you go versus a spread. The more spreads, the more difficult to manage.