Before You Buy a Stock Option - How They Work and Why They're High Risk

This video is so much better than your previous on the topic ("Stock Options Explained," posted on August 31st, 2018).

Thank you.

I sold cash secured puts. On BBBY. Yeah, didn’t end well.

side note, you need to drop your skincare routine. you are glowing.

you gotta' explain why they have the right to take bets for later dates like how is it allowed what's the premise behind it - that's what's confusing us beginners

After trading options for 2 years I learned 2 things.

1. They are COMPLEX tools.
2. They offer an incredible amount of flexibility. But this is a double edged sword.

Also its really easy to lose all your money due their leverage potential.

Ahh yes, options. The driving force of wsb disaster memes.
We salute ye brave soldiers who have lost multiple portfolios for our amusement.

I've had about five years of profitable trading and I use options. I wish more people could do so responsibly. I'm up 40% this year and those gains are virtually entirely options based. Iron condors, call credit spreads and now slowly transitioning to more and more LEAPS positions with the anticipation we'll pivot. Also running the wheel on stocks I want now. Might not do the upside part of the wheel on all of them though, but I'm potentially buying stocks that are dirt cheap even cheaper thanks to receiving a premium.

I avoided options for so long as I just saw unnecessary risk but I'm glad I've embraced them. All my stock holdings are still down this year, I believe. Maybe CROX is up? I don't even know.

thank you very much. this is very useful :)

Great explanation.

Thank you for this amazing video, you explained it perfectly

So... the danger with theoption is when you use all your money to pay for the premium of a huge bet. Ok. But if you dont do that, the risk is like 10 times less. Seems interesting. I think to put all savings into paying a premium is madness and is not the normal use of the option. It is like incel mixmaxing and then being throw into the Golgota.

so you said european options can only be exercised on the expiry date. does that mean they are cheaper ? becase you litterally get less option.

I did not understand. Why i am so dumb 🤣🤣 good one Sir, thanks for great content

🤣🤣🤣 my head hurts non-stop anyway. I'm a high learner. Yes I have an idea,just afraid to make my first move without understanding first.

Thank you so much. I've been starting at it for days months even. I want to use it

Can you go over RSU vs stock options

Hello fellow WSB degenerates. I am also taking steps to curb my habits

Can you give an actual example how to buy, do we need that money before we buy for example I am looking at buying a call, but says i need $700 or $3000

Basically guys, with shares you can buy and sell anytime you want. With options you're locked into the price and if it goes south, you can't sell it and you'll lose your money

great video, well explained the risks and potential benefits of options. well done really

This was a MUCH better and more understandable explanation than your previous video on options! Thanks!

Poor Henry ! 😆

Have you tried covered calls?

As a value investor I started considering to sell put options. I felt that in your video you touched only upon buying options. Have you considered to make one about selling put and call options?

Best way I had it explained to me - writing options is like selling insurance policies for an earthquake.

I think options can be very helpful when used appropriately.
Writing covered calls and cash secured puts is a nice way to make money waiting to sell the underlying, or waiting to buy the underlying.
And buying puts can help lock in potential profits or create a type of stop loss on a long trade.

Buying calls... I haven't found a risk off use for those yet... other than if you find yourself holding too many puts for security and not in many or any long positions... they can hedge an unbalanced put portfolio. Create a type of strangle trade.

Very interesting video - thank you for it :-)

I have been trading options for 2 years. If i can time travel I would tell my younger self to stop being a fucking idiot and disable options

please use bigger words dont let my fellow countrymen get away with being stupid

So it’s a legal cheating for people with insider information

Also you can sell covered calls, it’s my favorite options trade. It only limits upside potential for owning a stock, but in every other case besides a lot of growth in your stock, you will make more money than someone simply holding it without selling covered calls. Even if someone makes a bunch of money off of the call you sold, you will still make money.

Stephen Merchant's getting really good at his American accent

I don’t understand why would I buy a PUT Option and pay a premium. I can just put a stop loss order or sell my shares if I don’t like how the price of the stock is falling.

You should talk about options spreads in another video

This is very complicated to me. Since I am no seer, I’d rather play cards if I were to gamble. XD

I think Plain Bagel is the best channel I found about investing. Richard actually educates me rather than telling me to invest blindly. Or flooded with a masked ad. 😑

Thank you for this 🙌🏽

I did this recently with Astra. They had their first launch being broadcast and I am holding a long position on it, but to hedge losses I opened some short term puts to protect against the possibility of a failed launch driving the price lower. Launch did fail and the price dipped 20%.

I honestly always found it odd that what's essentially an insurance policy is used in such risky ways.

Great video! Thank you TPB.

No offense but if you’re yelling at bagel here about how his video was too complicated then maybe you should genuinely consider not trading these financial instruments

Just call the gambling autists on Robinhood as they are: fellow autist

thanks for your videos bro, you explaint it very clear...
ill keep with stocks instead all the other, seems less risky