Options trading courses can be taken online or in person, and they can be basic or comprehensive. Before an investor begins trading options, an options trading course might be a wise investment of time. Options trading knowledge is often available in abundance at no cost to the investor.
Many online brokers offer an online options trading course. Online options brokers benefit from having educated options traders. The types of options trading courses might differ slightly, but the fundamentals are the same. Online brokers often will offer the options training at no additional cost to their clients. An active trading account is normally required.
A comprehensive options trading course is offered by many online resources. These sites are created to educate investors about exchange traded options. The options exchanges offer basic and advanced educational resources.
A basic options trading course is applicable to the stock market, the commodities market and the currency market. The difference in trading these options is the underlying market. Put and call options are standardized throughout these different markets. Exchange traded options on equities and exchange traded funds (ETFs) are the same.
Options on futures contracts are different. Futures contracts are derivatives, and option contracts are derivatives. In this sense, options on futures are derivatives of derivatives. Specialized education is necessary to trade these contracts and is not readily available.
An options trading course might involve a considerable commitment of time. Even though the course may be free, options are a complex subject. For this reason, they will require an applicable amount of time to learn.
A basic options trading course might include subjects such as what options are and how they work. The benefits and risks of trading options will be covered, along with the pricing of options. The trader must learn how to read an options chain and how to place an options order. Even the most basic course will cover a lot of information.
An advanced options trading course will cover subjects such as various options strategies. Options strategies are combinations of buying and selling calls and puts. The strategy might also include buying or selling the underlying asset. The asset may be a stock or an exchange-traded fund (ETF). These strategies can be bullish, bearish or neutral.
Many options traders are trading volatility. Implied and historical volatility are major elements of option trading. An options trading course will cover volatility extensively.
The advanced course also will cover a study of the options Greeks. The major Greeks are delta, gamma, theta and vega. The informed options trader might want to learn about these subjects as well. The Greeks are helpful in deciding which strategy is the best to use.
Understanding when and when not to trade options requires the investor to have the knowledge to analyze the underlying asset. Analysis can be fundamental, technical or both. The trader might open a bullish options positions if the underlying stock were in a position to increase in value. The opposite would be true for a bearish position.