The rules and principles of making money in individual stock options trading are just like the creative process of an artist. First of all, artists will choose appropriate brushes and paints, and options traders will choose appropriate trading strategies and investment portfolios. The following will reveal the rules of individual stock options trading and the principles of making money. Do you know? This article comes from: Options Science Museum
Individual stock option traders choose appropriate trading strategies and investment portfolios; secondly, the artist will draw a rough outline on the canvas, and option traders will formulate corresponding investment plans based on market trends; then, the artist will fill in the details of the picture.
Individual stock options traders will carefully analyze market data and seize every profit opportunity; in the end, the artist will complete the work and display it to the audience, and the option traders will settle the profits and withdraw the money.
In this process, the rules of individual stock options trading play a crucial role. It stipulates the time limits and rights and obligations of traders when to buy, sell, exercise and other operations. These rules are like an artist's brush and paint, helping traders better understand and apply market trends, investment strategies, risk management and other techniques.
The principle of making money with OTC individual stock options is the core goal of options trading. The popular understanding is that it is the same as buying and selling stocks yourself. You can earn as much as the price goes up, but the market value starts at 1 million.
Just as the purpose of an artist's work is to display it to an audience and gain recognition and rewards, the purpose of an options trader is to find profit opportunities in the market and maximize profits.
This requires traders to have keen market insights and professional investment skills, while complying with the rules and risk control measures for options trading to ensure that they do not exceed their risk tolerance while achieving profits.
For example: On July 6th, I bought a stock option with a market value of 1 million, and paid a premium of 53,500. Today’s position profit is 104.15% and the profit is 1.04 million. Why do ordinary people buy options? How to make 1 million with 50,000 a month? This is my answer. This is the philosophy of options and the life of options.
Popular science on the rules of over-the-counter stock options trading
1. Trading time:
Opening a position: 9:30-14:30 on the trading day will be the transaction at that time (the transaction time is about 5 minutes); submissions after 14:30 will be the transaction on the next day.
Closing】The option can be exercised the next day after the position is successfully opened, and the longest period is the exercise period of the purchased option.
2. Exercise period and method:
The exercise period is divided into 2 weeks to 12 weeks (currently 1-3 months). The longer the exercise period, the higher the corresponding premium;
The exercise method is American-style exercise, which means that you can choose to exercise the option if you make a profit at any time during the period (except the day when the position is opened);
If the stock is suspended from trading, it will not be affected if the suspension time does not exceed the exercise period; if it exceeds the exercise period, the transaction will be based on the opening price on the first day after trading is resumed.
3. Stocks that cannot be purchased
1) Suspended stocks, ST stocks, stocks that have not resumed trading for more than one month, and sub-new stocks within three months
2) Stocks with opening price limit or price limit
3) When the opening price rises or falls by more than 8%, you can buy if there is a retracement below 8%.
4. Brokerage firms’ forced liquidation and risk control principles
1) Brokerage firms will intervene in the forced liquidation mechanism to hedge their own risks for two consecutive times (for Shanghai and Shenzhen individual stocks) with three consecutive daily trading limits (for Shanghai and Shenzhen stocks).
2) The daily limit is not cumulative if it is not continuous in the middle.