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Best Options To Trade | 3 Best Option Trading Strategies for Beginners

Many new traders like to directly dig into trading options, knowing little or nothing about the various option trading strategies that are available to them. It’s a common mistake that beginners do, and end up losing the chance to maximize their profit as well as limit their risks. Given below are some of the best option-trading strategies that new traders can use.
Best Options To Trade
If you are interested in learning more of these option trading strategies, best options to trade, or any other trading concepts, then Universal Investment Strategies is the best platforms to learn trading from.
Long Call
This is one of the most basic strategies a beginner can use. In this strategy, the investor simply buys a call option hoping that the price of the underlying security will rise dramatically before the contract is expired. The advantage of this strategy is that if the market goes soar, the profit is uncapped.
If the stock price continues to rise before the expiration date is reached, then the call keeps going up too. For this reason, even though it is one of the most basic strategies, it is a very popular way to wager on a rising stock.
The Covered Call
Covered call is a strategy where it involves the trader selling the call option for each 100 shares of the underlying security. In this strategy, the trader is expecting that the option will expire flat without its stock price rising above the strike price. This way, the trader can pocket the premium without actually having to sell the stock.
However, this strategy also carries the risk that if the stock price rises above the strike, then the trader will have to sell the shares at that price. Therefore, this strategy is best used when the trader owns the stock and expects it to remain flat throughout the option period.
The Long Put
The long put is a very popular and a commonly used beginner’s strategy. In this strategy, the trader buys a put option, often referred to as going long a put, and expects the stock price to be lower than the strike price by the end of the option period.
The benefit of this strategy is that if the stock price falls to zero, the trader can get a lot more profit than the investment made initially. This strategy is best used when you strongly expect the stock price to decline and when you need a large upside.
Universal Investment Strategies, LOS Angeles CA
UIS is a trading education platform that expertly teaches various concepts of trading to everyone who wishes to learn. Here, you can choose from the best trading courses and make your own trading strategy suitable for you with the help of our trading experts. If there is a best way to learn stock trading, then UIS is the place to go.
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