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Using Proven Methods In Developing The Best Option Trading Strategies

Many investors and potential traders are interested in the market but are not sure about how to select the best option trading strategies. This is very common for those new to options trading, which is very different from other types of investing.

In options trading, which is a short term of only a day or two to up to a couple of weeks, the movement of the market and the hitting of specific targets signals traders when to sell to maximize profits and to minimize risks.

Specifically, options are a contract that allows the trader to buy and sell stocks at a price and a date that is pre-negotiated. Instead of buying the stock itself, what the traders are buying is a contract. The contract provides the option to sell or to buy at a specific price, to sell the contract to another trader, or to actually allow the contract to expire. This last option ends any financial obligation to the contract and can be used to reduce any potential loss of continued investment in the hopes the market will turn around for the trader.

The Best Methods

Today, the use of high powered and very specific computer algorithms provide very comprehensive and effective best option trading strategies. These algorithms are developed over the years by stock option advisory services and are proprietary to the specific advisory service.

The algorithm runs continuously when the markets are open, tracking stocks and options that meet specific parameters or criteria. Then, in real-time, the options trading advisory service sends an alert to members, signally the buy price, a series of target prices and a stop. The trader receiving the message can choose to use any of the targets to set for the sale.

This allows the individual trader to determine the best option trading strategies for his or her own portfolio based on comfort with risk, the profit objective they wish to hit and the time they wish to extend the contract.

At Trade Genie, we provide the best option trading strategies for our members using our algorithm and proven trade evaluation criteria. To find out more, see us online at mytradegenie.com.