Originally Posted by
Finessed
I’ve never been a fan of options trading because it’s essentially like going to the casino. I appreciate your advice and agree “covered calls” would be the way to play options trading. Essentially you’re the house, and we both know the house wins (not always though).
This is the problem I have with your post. Selling a call option would result in the individual selling to write up the contract, correct?
You think a pilot like me is going to figure out how to write up a contract the likes of Warren Buffett’s math gurus write up their contracts??
a link below is the The Black-Scholes Formula used to write up option contracts
https://www.investopedia.com/article...eat_market.asp
It’s a dangerous game playing “the house” if you don’t know what the hell you’re doing.
Really good explanation of covered calls btw, I actually took a screen shot of your post for future me to read over again.
Black Scholes is worthless.
And I HATE the comparison of options trading and a casino. If you truly feel that way, then no it isn't for you. You are correct that it is a dangerous game if you don't know what you are doing. So I highly recommend that you educate yourself. After all, flying an airplane is dangerous if you don't know what you are doing, no?
Selling a call option means nothing other than you have to be long the stock you are selling the contracts on. You only limit your profit potential, you cannot lose money if the option is assigned.
Whatever you do, don't buy into these 'systems'. Learn what options are, how they work and be disciplined in your approach executio.