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Why should a retail investor never buy derivatives? spreads?
by marojejian 3mo ago
Why should a retail investor never buy derivatives? spreads?
- dboreham 3mo agoNot the parent but I'm guessing: a) it's expensive and b) you can shoot your feet off.
- miningape 3mo ago[dead]
- baal80spam 3mo agoIt's all about getting a call from the dreaded Margin.
- pid-1 3mo agoRetail investors do not have access to systems that calculate risk, margins, pnl, etc... and generally also don't have the necessary knowledge and market data to price such instruments correctly. Most ppl are better off KISSing and lowering risk by selling equity for fixed income.
- jurgenburgen 3mo agoIronically you can use AI tools to get some idea of how to trade puts.
- sitzkrieg 3mo agothis hasn’t been true for years. retail investors can’t get advanced risk suites from any normie broker these days
- inigyou 3mo agoYou almost always lose a lot of money if you're seeking safety. Protection from downside risk on your S&P500 investments may cost 20-30% of your investment at which point you're better off just selling the investment and hoping it doesn't go up by that much.
- baq 3mo agoIt’s scaremongering, you can learn all this stuff. However! If you don’t want to learn and want to get rich quick instead, stay away.