I’m new here - where should I get started?
First, I want to welcome you on board to Option Alpha and let you know that you've made an excellent decision. Sometimes it's hard to know where to get started, so we suggest a couple of things. First, check out or tour video inside the support center here which will help you get the most out of Option Alpha right now based on your current membership level. Second, head on over to our "Tracks" page and start working on the track that best fits your current experience and trading level. Finally, don't forget to sign up for one of our LIVE on-boarding webinars with our head trader, Kirk. It's your opportunity to learn more about how we trade options and get your questions answered in real time. Don't be too overwhelmed with all the information that we have here at Option Alpha. There's a lot to take in but take your time and remember that just 30 minutes a day can be the difference between where you are now and where you want to be with your investing goals.
Where do I go if I need help or have a question?
The first place to go if you need help or have a question is our answer vault, which you are in right now. 86% of members we have surveyed say that they have found their answer to their question in less than two minutes here. If you still need help, you can post a question in our forum section and get help from other traders like you. Finally, the last resort is to email us. We also prefer that you post questions to our Facebook or Twitter profiles if you'd like a faster response. Rest assured, there are multiple ways to get your questions answered, and we will always be here to help you along the way.
Where can I find the video training courses?
You can find all of our video training courses located in the tutorial library here. From there you can dive deeper into the individual modules and sections. And of course you can always use the search button on the top of the page to search for particular topics or content.
Where can I download the checklists, PDF guides, worksheets, etc.?
You can download all of our training materials right here. All of the PDF reports and guides will be updated frequently throughout the year as needed so check back frequently for updates. We'll also be adding new worksheets and PDF guides as we get feedback from our members like you. Again, everything will be accessible from this one central location, so you never have to go searching for them.
How can I be more consistent with my options trading?
Great question. Consistency starts with having a system in place to make and exit trades. Have a set of guidelines or trading rules that you follow and do not deviate from those. The more robotic and mechanical you can be with entry and exits of trades the more consistency you'll see long-term. Consistency is not something that happens overnight but is rather build up over many weeks and months of smarter trading. Remember that the options trading business is nothing more than a big game of numbers and probabilities. If you place enough small trades with a high probability of success then the numbers always will play out in your favor over time. Don’t expect to win 70% of the time when you only place 4-5 trades a month, it’s just not likely to happen. But if you place 100 trades per year I can almost guarantee that the numbers will work out to approx. 70% winners. This isn’t theory it’s just how the math works. So, place lots of small trades so that if one trade goes against you it doesn’t blow up your account and play the long-term numbers game.
I’m completely new to stock trading and options trading where do I start?
Start where you are. There are so many different concepts and topics to learn when it comes to stock and options trading that you can't possibly learn all of them overnight or even over the course of a couple months. Therefore I suggest that you lay out a framework of topics you want to cover in a systematic fashion. You could for example learn everything there is to know about credit spreads one week and the next week focus on learning everything you can about the Greeks. Sure there will be some overlap and you might not know all the concepts as you start to go through the different weeks and topics but over time you'll start to understand by focusing in on one area at a time. As a member at Option Alpha we’ll help you along by giving you predefined “Tracks” to follow that help teach you how to trade options from start to finish.
What is the difference between buying and selling an option?
When you buy an option you have the right but not the obligation to buy or sell stock in the future. When you sell an option you take in a premium which then gives up your right to choose when to buy or sell stock in the future. But being an option seller doesn't mean you can't still reverse the trade and close out the option position - you just can't decide when to buy/sell the underlying stock at expiration. That said, option sellers statistically have the greater profit edge over option buyers because implied volatility is always overpriced long-term.
Should I be a net buyer or net seller of options?
Net seller. No study or body of research has found that just option buying is profitable long term. In fact, even when you buy options before huge market moves higher or lower the embedded volatility edge that you pay for as an option buyer erodes your ability to consistently make money. Does this mean you can’t make money buying options - nope, you can, just not as your only strategy. Net sellers of options consistently outperform option buyers in nearly every market situation. When implied volatility is high the edge to net sellers is even greater.
I've heard that options are extremely risky and will blow up my account?
Options are risky but blowing up your account is very simple to prevent. It's all about knowing the odds of losing money based on trade size and the smaller you make your trade size the smaller your probability of blowing up your account is. In fact, if you trade with position sizes less than 5% of your account balance you have a 1 in 1.3 billion chance of completely blowing up your account. So, as you can see those people who say options trading is extremely risky have no idea how the numbers actually work and are likely trading positions that are way too large for their account balance. At Option Alpha we strongly encourage everyone to keep their position sizes between 1-5% of your account balance.
What is the minimum account starting balance you suggest?
While you can start trading with less money we do suggest that you at least start with $3,000-5,000 to make it worth your time and energy (and to cover commissions) with the number of trades that you'll need to be making. If you have less than this amount please do not get discouraged, start paper trading as soon as possible as you save up enough money to start live trading.