Wealth Building: Options

Build Wealth with Options Trading

Have you ever considered options trading as a means for wealth building? If you have, then you’ve come to the right place. At Woodberry Wealth Management & Associates, we provide an in-depth approach to wealth building including options trading in collaboration with some of the best options trading brokers in New York. With the proper guidance, options trading are a great way to build a powerful financial portfolio.

What are options?

In a nutshell, options are contracts in which a buyer pays a premium (the price of the option) for the right to buy or sell a certain investment at a set price (called the striking price or exercising price) within a set time period. There are two key players when it comes to option trading: the Call and Put.
A call is an option to purchase, while a put is an option to sell. The option holder is under no obligation to sell. However, a call buyer hopes the price will rise enough for him to exercise his right and sell at a profit.

Let’s illustrate the basics of options trading with an example:

Let’s say you pay $200 for an option on 100 shares of stock, with an exercise price of $20 per share. The stock then goes up to $30 per share. The option holder can then buy (call) at $20 per share, and sell (put) at $30, for a gain of $1000. Since the option cost was only $200, the investor profited $800!

Is Options Trading For You?

Most options are for relatively short time periods: typically 9 months or less. It’s difficult to predict stock market behavior over such a short period. For this reason, the purchase of options does not appeal to everyone. On the other hand, the premium on options is substantial, and averages about 10 percent of the price of the security. Option selling can easily yield a return of 12% to 15% and may do much better. Especially when you’re guided by trained options trading brokers in New York.
Consider your personal financial situation before deciding on this type of investment. If your income, net worth, or age precludes taking high risks, then by all means seek a safer method of investing, but if you are in a relatively secure situation, then options offer you a chance to make a sizable profit while limiting the amount of possible loss.
Traversing the sometimes rough terrain of the New York Stock Exchange can be tricky at best. At Woodberry Wealth Management & Associates, we work with top-notch options trading brokers in New York. Together, we will help you make solid investment decisions and build a strong portfolio.

Contact us today to learn more about wealth building with options trading.