What Is Stock Market

Due to the demand and recent emails asking about Put and Call options we have decided to create a page explaining these tools.

Put and Call options are great in a way that the buyer (the buyer of the option) and not the option writer, is immune to big losses and the gains are unlimited. You can only lose the initial premium you have put in given the option expires and it is not worth exercising.

The good thing about options is you can put a small amount of money and gain large amount of returns given your direction in stock is right. You only can lose the initial premium you have put in, and the loss never exceeds that, and you can gain good returns with small initial investments (premium paid).

The bad thing about options is that time is your enemy and options have a expiry date (stocks don’t). You can not hold ferever until you reach your value you want to get rid of it, vs stocks you can. Options usually expire on the 3rd friday of the month that it is written on the contract (for North American options). Options can be purchased with expiry of one week to 3 years from date of purchase. You can read more about how to get started on option trading here.