Learn Options Trading

Most individual traders fail when using their own options strategies. Why? Because they allow their emotions to over rule their trading rules. They toss these out the window when they get a "gut feeling" or when a trade that they really believe in reverses the trend. Successful traders are never attached to an individual trade. Picking a trading strategy and sticking with it is key to accumulating wealth through trading. Emotion needs to be left out of it.

Here are a few options strategies that you can use to take the emotional aspect out of trading:

1) Don't assume that a losing position will correct itself and never add to a losing position.

There is a reason for the expression that " the trend is your friend." It will tell you when your trade is on track and it will indicate when the trade is headed south. Don't fight it. Don't assume that it will turn itself around. Averaging down into a losing trade is a sure way to lose your money.

2) Trade when the market goes up and when it goes down.

Most traders know how to buy calls. They know how to buy when they believe that the market will go up. But there is an equal amount of money to be made when it goes down. You have to be comfortable investing in both calls and puts. Again look at the trend and if it reverses get out of the trade.

3) Trade logically.

Fear based trading is a sure way to lose money. Fear creates paralysis. It keeps you from pulling the trigger and getting out of a trade.

4) The objective of successful options strategies is to create profit.

The way to achieve this is opposite of what many believe. You are not there to buy low and to sell high, but to buy high and to sell higher, or to sell short low and to buy lower. Look at the trend.

5) Sell markets that show the greatest weakness; buy markets that show the greatest strength.

Again look at the trend. You are not here just to buy into strong markets. You are here to make a profit either way.

6) You do not have to be in a trade all the time.

There are times when the markets are flat or in a sideways trend. This is not the time to enter a trade. Stay out of the market!

7) No one can predict the market.

Just when you think you have the market figured out it can change on you. Your options strategies should always include entry and exit points. Have a stop loss point in mind for each trade before you enter it.