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Hi KittP.

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leemalone2k3   Wednesday, 06/22/16 06:35:07 PM
Re: Zorax post# 597
Post # of 623 
Hi KittP.
All options have an expiration date, but some of those expirations go out for two years. Take for instance the SPX- The S&P500 index has options you can trade until the Third week of December 2018.

Find out from scottrade what type of option trading authority they allow you to trade. You may also want to shop around at other brokers to compare commissions. I use Thinkorswim and Option House as my brokers.
Level 1 allows you to sell covered calls against stock you own- a great way to pay yourself weekly and protecting your long stock positions
Level2 allows you to purchase calls and puts, and then sell them.
Level 3 allows you to sell spreads on stocks. This means if you purchase a option, you can sell other options against them.
Level 4 allows you to trade naked short options on stock.
Level 5 allows you to sell naked short index options
If they only allow you level one, I would suggest searching for another broker that will allow you at least level 2. I use level 3 authority on 95% of my option trades for the following reasons:
Spreads cost you less to trade
You can make money on spreads even if the stock stays flat or only moves a little bit.
You have a higher chance of a winning trade with spreads.
Before you trade any options, I would highly suggest you educate yourself on option valuation.
You also may want to visit us at www.optionmillionaires.com. Tell jb I sent you and perhaps he will give you a couple of weeks free in our live chat room.

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