For most investors, the world of “options” is another universe. Most investors don’t understand how they work, how time decay affects them, or why they can dramatically change the price when their underlying asset ‘hardly’ moved. So it's very understandable why a lot of investors simply stray away from options and stick to the ‘simpler’ investments they understand.
However, every investor should at least attempt to understand how options work and why they are important to the market. Further, most (especially long-term buy-and-hold investors) investors should, at the very least, occasionally dabble in options from time to time.
I know what you are thinking, “this guy is nuts, options trading is gambling, not investing, I have been there, done that, and I’m not doing it again.” But hear me out before your stop reading.
First off, I am a long-term buy-and-hold investor at heart, and that is what I recommend to everyone. Historically, long-term buy-and-hold investing is better than trading, short-term market timing etc., etc. However, with options, you can be long-term investors and make a little cash on the side while essentially having zero risk, at least zero risk of losing capital. Continue reading "ETF That Opens The Door To Play Options"