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Sweet that makes sense. Also for choosing one underlying do you mean only trade options on one single security? So not doing company by company analysis but cho
by ceh123 5y ago
Sweet that makes sense. Also for choosing one underlying do you mean only trade options on one single security? So not doing company by company analysis but choosing a single company and then trading options on that one to learn the types of strategies?
- qeternity 5y agoIn terms of learning options, fundamental analysis isn't relevant: the "why" doesn't matter. If you're wearing a bunch of 20 delta call spreads, and the underlying jumps 10% it's more important to learn what that means for your risk than it is to learn why the underlying moved. Now of course you want to do both, because ultimately you'll want to know why vols are trading where they are, which will be determined by the behavior of the underlying. But at first you just want to get a qualitative sense of how all the pieces fit together. Then once you do, you can do you fundamental analysis and incorporate that thesis, and start to develop a vol thesis.
- ceh123 5y agoOkay yeah that makes a lot of sense. Thanks for the suggestions.