Monday, April 26, 2010

Sunday, April 25, 2010

7 deadly sins of options trading by Ron Ianieri

They are:

1.Not fully understanding the independent effects of time and volatility on your option.

2.Forcing a pre-selected strategy on every opportunity.

3.Not fully understanding the proper meaning of leverage as applied to trading.

4.Not fully understanding the foundations or building blocks of option theory.

5.Thinking that cheapness or expensiveness of options is determined by dollar cost.

6.Overcomplicating otherwise simple strategies.

7.Not knowing how to pick the correct option for the selected strategy.