Now we can profit from options as a community – keep reading till the end and you will see, I really do mean community:
As stated in lesson 6, an option is a purchase of the right to execute a trade at a given point in the future. It can either be put (sell) or call (buy). The idea is that most online options brokers do not offer options in the traditional way (like banks or funds do) and they simply let you pick a time frame and a direction and as long as your are right, you receive the payoff (whether you get the direction right by 1 pip or 100 pips etc). For example, do you think the EURUSD will go up or down over the next minute,hour,week,month etc. As you can imagine, for some people this is easier because:
1.) They find it easier to asses a trend rather than absolute amounts, especially over longer periods.
2.) They find it convenient that they can not be taken out by sudden spikes.
3.) They know their risk and exact payout before entering a transaction which for many people is comforting.
However what are the smart ways to play options:
Well the smart way is not to gamble and rely on luck but rather to have logic behind your put and calls. And there are two ways to profit doing this.
A.) Have options with expires of 2 minutes, one minute before key economic data is coming out.
B.) Have options with expires of weeks or months where you can benefit from your fundamental analysis and determine which the direction of pairs.
For this I found two suitable platforms that I whole heartedly recommend to the community:
$5-$10 minimum deposit – Its open for everyone.
$1 minimum per trade – Its open for everyone.
The key points above were very important for me, as I do not wish to make this a “rich man’s/woman’s club” and want everyone to be able to participate and I really think that everyone should sign up to this as most foundation graduates would be able to handle this with their knowledge of fundamentals and make a decent profit.
Mobile App – The Iphone app is decent.
Uses Reuters as its price source (reliable)
Funds are in a European Bank – Safe.
Many deposit methods and withdrawal methods.
Minimum withdrawal of $1.
Withdrawal takes 3 days. I read on other sites that its faster, but the person who recommended this (and whom i trust completely) said it took 3 days for him each time.
Referral fee means revenue earned for the community.
How to use:
Turbo Options: For options of only a few minutes on currency pairs.
Use along side trade ideas on the options forum, for medium and longer term options.
Where to sign up:
Consider this scenario:
With a 90% payout reward, if you make 10 trades a month and have a 60% success rate.
Profit = Won trades – Initial amount
Profit =(1.9*0.6) – 1 = 14% a month.
14% a month for 2 years = 1.14^24 = 2321% return. Not bad at all.
14% a month for 3 years = 1.14^36 = 11,183%.
Things always look small when you think short term (small). Think long term (big) and things suddenly look much more attractive. Its why all the best things in life take time, effort and hard work!
Such winnings can be treated as the pocket money of the community per say. Leave your Etoro nest egg to grow and accumulate as much as you want for the next year or two (till you meet your target) and use this money as your enjoyment money. Because lets face it, when you are profiting so much, its really hard not to be temped to take out those returns and treat yourself. This way, hopefully you will not have to.