Summary of Joe Duarte's Trading Options For Dummies (For Dummies (Business & Personal Finance))

By IRB Media

Get the Summary of Joe Duarte's Trading Options For Dummies (For Dummies (Business & Personal Finance)) in 20 minutes. Please note: This is a summary & not the original book. Original book introduction: Updated with new facts, charts, and strategies to help investors beat today’s tough markets, Trading Options For Dummies helps you choose the right options based on your investing needs. It will show you how to weigh the costs and benefits, build a strategy to gain no matter the market conditions, and broaden your retirement portfolio with index, equity, and ETF options.

• Language: English
• Publisher: IRB Media
• Release date: Dec 1, 2021
• ISBN: 9781952482878

IRB Media

With IRB books, you can get the key takeaways and analysis of a book in 15 minutes. We read every chapter, identify the key takeaways and analyze them for your convenience.

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Insights on Joe Duarte's Options Trading For Dummies For Dummies Business Personal Finance

Contents

Insights from Chapter 1

Insights from Chapter 2

Insights from Chapter 1

#1

The goal of options trading is to make money, and to do so, you must take on risk. You do this by buying an option, which gives you the right, but not the obligation, to buy or sell a specific stock, ETF, or index at a set price within a certain time frame.

#2

Algorithmic traders, also known as bots, are computer programs that execute trades at lightning speed. They are responsible for 80 percent of all trades in the stock and related markets.

#3

Before you start trading options, it is important to know your financial situation, your risk profile, and your time commitment possibilities. Remember to never trade with money that you aren't willing to lose.

#4

The first step in planning any trade is to understand the components of the trade - the underlying asset, the option contract, and what the algos and other market participants might do.

#5

To utilize options to their fullest, you must first understand the asset they're based on. This may require a level of analysis beyond your current skill set.

#6

The two main risks involved with options are time decay, which is the loss of value the option incurs as time passes, and leverage, which increases the percentage change in an option's price.

#7

The price of a call option increases when the underlying stock's price goes up. The price of a put option increases when the underlying stock's price goes down. The option with the best combination of these two factors is more expensive, and therefore more valuable, than the others.

#8

Options are different from stocks in terms of what they represent - leverage, rights, and obligations instead of partial ownership of