The approval is not the rule of the brokerage firm but rather the Government. It's the written rule of the Option exchanges and their clearing corporation who had to stick the rule in their constitution - by laws so that they could be approved by the SEC (this was long before the CFTC)
NO you don't have to spend time learning to trade equities before you trade options - most people never learn to trade at all.and they try.
Visit a branch office of a major reputable brokerage firm, or even one of the discounters (Schwab - Etrade etc Many discounters may have offices in your neighborhood ) speak to the manager - most of them are option principals who can approve you The way you wrote your questions, you may be able to talk the manager in giving you approval,at least for the basics. Don't bring up about learning what to do - you can always count the time you spent "reading" about the markets, stocks and options as time with equities and/or options
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Most of the people that apply on-line do not tell the truth in their applications. I am not telling you to lie, nor would I ever suggest it, but unless you have been banned by a brokerage firm, have a felony conviction or are minor, no one can tell what's real or fake on your application.,
I appreciate your honesty, if you walked into my firm based on the wording of your question, either myself or my managers would approve you for trading in a New York minute
I wish you the best of luck, I think you should go for it.
Here's some option sites for you
Schaeffer - http://www.schaeffer.com/
Options - http://www.options-trading-advice.info/
Option Education - http://www.optionseducation.org/
Zacks - http://www.zacks.com/
You should try with Penny Stocks Trading (you can find more info here: http://pennystocks.toptips.org)
Penny stocks, also known as cent stocks in some countries, are common shares of small public companies that trade at low prices per share.
I've been subscribing to this PennyStock web site for about a year now and have loved the objective advice they give. He really does look for quality stocks and I've made some pretty nice profits on a lot of his suggestions. Being still fairly new to investing I have been dabbling a lot in penny stocks to try and grow my account. I may not have a big account, but it's a lot bigger than it was a year ago. On just one of Nathan's picks this year I managed to make my investment back ten-fold! Be careful! Penny stocks are notoriously risky but if you follow the right method the risk is almost 0. I suggest to invest only little money first and then reinvest the profits. This is the site I'm using: http://pennystocks.toptips.org
Bye
You seem to have this all the wrong way round. Options are derivatives and they are a geared product. Gearing or leverage spells danger to the uniniated. True you cannot lose more than you put in (well not unless you write options) but you can lose all of your money a damn site quicker than with equities:
Buy 100 ABC at 500
Buy 1 ABC option at 50
If the stock goes down 10% and remains there til expiry the option gets wiped out (and that's ignoring the erosion of time value).
Investment basically consists of one thing: getting the direction of share price movement right. It doesn't matter if you use direct equity investment, CFD, Spread Bet or Options. If you don't get that basic premise correct then you are the LOSER.
To trade in options or any derivative your broker will require a separate "derivative Risk warning" showing you have experience and understand options. Or they SHOULD do!
You can make too much money with Binary Options and you have to ways for that: learning to do very well or as you can see clicking the link below: ( http://forexsignal.kyma.info ) The most important thing is that if you have the right programs and you study the right stuff you WILL success in this buisness! This course explain everything you need to start a very profitable trading activity.
I have read all the respones you have received, many of them were written not based on their experience but what they believe to be true. It appears not one of them has ever worked in the industry, or was in a position to approve either margin and/or option accounts
Yes you have to sign a disclosurer, but very few if any read them, understand them or could even explain them if they did read them.
As long as you undertand the risk you a taking by buying a wasting asset (one that may be worhtless in a defined period of time) I think you should go for it.
When they started trading listed options most of the floor traders did not know what they were, but they started, many did not even trade equitiies (most were trading commodities), so the b.s. about learning by trading equities is totally wrong.
Who cares that you have student debt, not one really cares or tracks it and it does not prevent you fom opening a brokerage account, a margin account or an option account.
I agree with the "Old Guy" you should go for it , and I too in my firm would approve you for option trading and I'm sure there's a lot of people like me and the Old Guy.
Go talk to an option principal (the branch manager) at one of your local brokerage firms, they can give the option agreement and approve it on the spot.
I too wish you the best, after nearly 50 years in the business you learn to spot people that can make it - Go for it
If you are looking for low risk and high return trading options, then I would suggest you to visit http://amzn.to/1ynhZSe . With the Genius Trading System you'll discover the Simple Proven System for earning the money as quickly as possible.
Who told you trading options was less risky? Why do you think you would lose more money than you invest if you buy stocks? (they can't go below zero, so unless you are operating on margin there is less risk than options, that is for sure)
Frankly, I don't think you have a clue what you are doing and if I were you I would stay away from options and learn how to invest by trading stocks.
The gaps in knowledge makes your question very scary.
Forget trading options. Without years of experience in stocks first, you would lose quickly and not even understand why you are losing. Paper trading does not properly replicate liquidity, costs, or the pressure of using real money.
Forget short term "trading" altogether. Focus on learning how to invest long term.
Suggested reading for novice investors:
One Up On Wall Street - Peter Lynch
A Random Walk Down Wall Street - Burton Malkiel
The Intelligent Investor - Benjamin Graham
EDIT: Looks like there are folks capable of running back office tasks at an investment firm without having the slightest clue about actually investing money.
I'm earning good money with this binary option signal sofrware ( http://forexsignal.kyma.info ) What I'm going to show you now might irritate old-fashioned traders who can't accept that a piece of software can outperform what they have learned through many years of trial and error
It is my opinion that you cannot perform any kind of derivative trading without knowledge and experience in trading the underlying stock or asset. It is like saying whether you should learn to drive or go straight for NASCAR training. Trading in stocks first gives you essential exposure in how it feels to have your money tossed around and how your emotions behave under those conditions. That's more important than knowledge. Most people who gives up even in stock trading, which is alot safer than options, simply cannot consider options trading. However, it is also my opinion that you should be learning about options while gaining experience in stocks trading. There are comprehensive free resources on options trading like http://www.optiontradingpedia.com which teaches you almost everything you need to know about options trading. You will find that there are soooo much to learn about options before you can consider trading them. They look deceptively simple at first but you will be surprised how much knowledge you lack especially if you jump in right now. Becoming successful in the capital market takes decades of work, not just years, so if you are unwilling to put in the time, you won't get anywhere in the capital markets. There is simply no shortcuts or everyone would be rich by now.
I'm a "newby" to trading and have attended various seminars, read books, etc. I'd like to start off trading options rather than securities because I've heard they're not as risky. With options, I only lose what I put in and can get a much higher % of return than securities. I don't have to worry so much about all the technical analysis or pe ratios. Rather than wasting my time learning all about trading securities, how to read fundamentals, etc, only to end up trading options in the long run, I'd like to save time and go straight for the options.
My problem is that most brokerage firms say they have to "approve" someone to trade options. If basic option trading is less risky than trading securities, I don't understand why one would need approved or previous stock experience to do it. I also don't know if I'd be approved to trade options, because of my school debt (which I'd like my market proceeds to pay off since it won't be taxed).
I don't plan to go crazy. I'm going to do lots of paper trading first and make consistent profits with that before actually going for it. Even then, I only plan to invest 10 - 20% of my disposable income and not investing in just one.
So my question is, do I have to waste my time learning about and trading regular stocks before I can begin to trade options? If so, I'll have to do some double learning and my goals will take years to accomplish.
It depends on two things:
? Whether you can wait for a long time or not.
? Whether you can bear more risk or not.
If you can bear more risk you should go with options and if you want steadily profit in low risks than you should go with stocks.
Don't start! You will lose your money.
