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What is options trading?

Options trading means buying or selling an asset at a pre-negotiated price by a certain future date. You can get started trading options by opening an account, choosing to buy or sell puts or calls, and choosing an appropriate strike price and timeframe.

How do I learn options trading?

To learn options trading, it’s necessary to become familiar with a unique set of terminology. Here are a few of the most common terms used for options: Strike price: The price at which the option becomes in-the-money (ITM). For calls, an option above the strike is ITM. For puts, an option below the strike is ITM.

How much does options trading cost?

Though many brokers now offer commission-free trading in stocks and ETFs, options trading still involves fees or commissions. There will typically be a fee-per-trade (e.g., $4.95) plus a commission per contract (e.g., $0.50 per contract).

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