How are Options Trade different from Stock Trading?
I'm a college student and recently I've been playing stock simulation games online. Hopefully I gather enough capital to trade in the real market within a few years from now. What I do on the simulation game is simply buying and selling company stocks. I noticed some people make a lot of profit from doing options trade. How does Options Trade work? How is it different from regular stock trading? Would you say it's riskier investment method than stock?
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Answer by bryan e h
Options are not an Investment they are a bet. as in Gamble. and so are stocks to a lesser extent. Options are very short term bets. The stock owners make money because you pay them a premium for the option, that is the only reason they exist so that the stock owner can make money without risk. You will only make money on them if you get lucky or if you have a crystal ball that predicts the future otherwise you will loose.
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