How To Make Money Using Futures & Options

By | September 17, 2018

In case you are considering the path of making money using Futures and Options, it is of foremost importance that you gather a fair volume of knowledge about what they really are and how you are supposed to advance with this kind of investing and trading.

It must first be understood that Derivatives or Future & Options are those kinds of leveraged instruments that are put to use for trade in stock markets. There are also different groups of investors that make use of such a process of investing which you must know about right at inception.

For which groups is it suitable?

One of the most integral things that you need to grasp before you think about trying to make money using Derivatives is whether or not you fall under the category of investors for whom this is a viable option. There are three categories of investors that particularly benefit from Options Trading and they have been discussed as follows.

  • Short-term traders looking to make quick money can think of leveraging their instruments by means of Derivatives into making hundred percent returns using just ten percent of stock movement. But be careful of losing the return if the stock moves in the opposite of the lucrative direction.
  • Long-term thinkers of investment often make use of Futures & Options in order to effect a long-term hedging of the portfolios they possess. Such an action brings about extra returns on the stock holdings and Options Trading is the more commonly chosen alternative in making minor returns in short-term trades.
  • Big investors who are into buying long-term options with a long-term view of things also tread this path.

How to make money using Futures & Options?

It is important for investors to pursue Options Trading with a keen interest in doubling finances and getting rich. Here are some of the ways you can consider in order to make quick money, walking this path.

  1. You can consider opening a brokerage firm, for even if trading does not reap as much money as you had expected, there are plenty of investors who are who would be keen Options Trading. Starting a brokerage firm for these traders and charging brokerage in case of Derivatives is a good idea.
  2. In case you lack the resources to open a brokerage firm it is wise for you to become a sub-broker wherein you can suggest the suitable trade to investors free of cost and charge brokerage when they indulge in it.
  3. Indian traders may also consider conducting workshops imparting knowledge of Futures & Options trading to budding investors.
  4. Selling software or data that has to do with Options Trading is also quite a good idea, and if the content you incorporate in them is good, you can make it big in no time.
  5. You can also consider starting a tip or newsletter service with your clients wherein you can divide them into long and short-term equity groups in the rotation, thus making sure both groups of your clients are profiting from time to time.

You must be aware by now, that it is imperative to have knowledge about leveraged instruments used in trade at stock markets in order to be able to make money by means of such investment. Make sure you find your foot strong and sturdy when dealing with Futures & Options, for a better turnaround in the long run.

Disclaimer: I am not a stock market expert or analyst. This information is shared as per my knowledge only. Don’t consider them as investment advice. In case you are interested to make money using Futures & Options, then learn them your own or take help from certified financial planners. Thank you for the understanding.

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