Comments on: 6 Great Option Strategies For Beginners http://www.stocktradingtogo.com/2009/03/27/great-option-strategies-for-beginners/ Investing Online Made Easy Fri, 20 Nov 2009 09:55:02 -0500 http://wordpress.org/?v=2.8.4 hourly 1 By: Mark Wolfinger http://www.stocktradingtogo.com/2009/03/27/great-option-strategies-for-beginners/comment-page-1/#comment-97141 Mark Wolfinger Mon, 07 Sep 2009 02:54:29 +0000 http://www.stocktradingtogo.com/?p=5055#comment-97141 MM, Thanks. Explaining how things work to the rookie is my goal. I'm happy you find these articles helpful. To see many more, also visit: http://blog,mdwoptions.com Regards, Mark MM,

Thanks. Explaining how things work to the rookie is my goal. I’m happy you find these articles helpful.

To see many more, also visit: http://blog,mdwoptions.com

Regards,
Mark

]]> By: miroslaw matysiak http://www.stocktradingtogo.com/2009/03/27/great-option-strategies-for-beginners/comment-page-1/#comment-97138 miroslaw matysiak Sun, 06 Sep 2009 23:57:00 +0000 http://www.stocktradingtogo.com/?p=5055#comment-97138 You make stock trading easy and simple to understand.Most articles i can't even begin to understand. Points you are making help me a lot. Thank you. You make stock trading easy and simple to understand.Most articles i can’t even begin to understand. Points you are making help me a lot. Thank you.

]]> By: Mark Wolfinger http://www.stocktradingtogo.com/2009/03/27/great-option-strategies-for-beginners/comment-page-1/#comment-96188 Mark Wolfinger Thu, 20 Aug 2009 04:37:54 +0000 http://www.stocktradingtogo.com/?p=5055#comment-96188 Bryan, You have not yet learned to recognize that a credit spread is equivalent to a debit spread - and you can use either position to achieve exactly the same results. Example If you SELL the XYX Jul 45/50 PUT spread, that gives you exactly the same risk and reward potential as BUYING the XYX Jul 45/50 Jul CALL spread. Neither one is 'better' than the other, assuming the options are priced efficiently. So if you prefer to buy a call spread instead of selling a put spread, that's fine. For the spreads to be equivalent however, it's essential that the strike prices be the same. If you prefer buying a put spread, instead of selling a call spread, that's also fine. Take a look at the reference below, but I don't usually recommend that someone who is a VERY new trader get to this information yet. But, it is important and if you grasp the ideas behind equivalent positions, then you will have moved a LONG way towards becoming a successful trader. Why? Because this demonstrates that you <i>understand</i> options. http://blog.mdwoptions.com/options_for_rookies/2008/07/equivalent-posi.html Bryan,

You have not yet learned to recognize that a credit spread is equivalent to a debit spread – and you can use either position to achieve exactly the same results.

Example

If you SELL the XYX Jul 45/50 PUT spread, that gives you exactly the same risk and reward potential as BUYING the
XYX Jul 45/50 Jul CALL spread.

Neither one is ‘better’ than the other, assuming the options are priced efficiently.

So if you prefer to buy a call spread instead of selling a put spread, that’s fine. For the spreads to be equivalent however, it’s essential that the strike prices be the same.

If you prefer buying a put spread, instead of selling a call spread, that’s also fine.

Take a look at the reference below, but I don’t usually recommend that someone who is a VERY new trader get to this information yet. But, it is important and if you grasp the ideas behind equivalent positions, then you will have moved a LONG way towards becoming a successful trader. Why? Because this demonstrates that you understand options.

http://blog.mdwoptions.com/options_for_rookies/2008/07/equivalent-posi.html

]]> By: bryan http://www.stocktradingtogo.com/2009/03/27/great-option-strategies-for-beginners/comment-page-1/#comment-96186 bryan Wed, 19 Aug 2009 22:58:24 +0000 http://www.stocktradingtogo.com/?p=5055#comment-96186 Im a new options trader and I like using the debit spread strategy. I notice you have credit spread but not the debit. Any reason you dont recommend this strategy? thanks Im a new options trader and I like using the debit spread strategy. I notice you have credit spread but not the debit. Any reason you dont recommend this strategy?

thanks

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