An analogy – Checkers is to buying stock as chess is to trading options.
-------------------------------- An analogy – Checkers is to buying stock as chess is to trading options.
Someone said that investing in stocks is pretty much like playing checkers. Any 10-year old can do it. You really don’t need much experience or understanding. If you can read, you can buy stock (and probably do just about as well as anyone else because it’s basically a roulette wheel choice in spite of the near universal belief that you are smarter than anyone else).
Options, on the other hand, is more like playing chess. It can be (and is, for anyone who is serious about it) a life-time learning experience.
You don’t see columns in the newspaper about interesting checker strategies, but you see a ton of pundits telling you why you should buy particular stocks. People with little understanding or experience buy stocks every day, and most of their transactions involve buying from professionals with far more resources and brains (and for some reason, these professionals are selling the stock to them instead of buying it).
Option investing takes study and understanding and discipline that the purchase of stock does not require. Every investor must decide for himself or herself if they are willing to make the time and study commitment necessary to be successful in option trading. Most people are not.
It is a whole lot easier to play a decent game of checkers than it is to play a decent game of chess. But for some of us, options investing is a whole lot more challenging, and ultimately more rewarding.
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Any questions? I would love to hear from you by email (terry@terrystips.com), or if you would like to talk to our guy Seth, give him a jingle at 800-803-4595 and either ask him your question(s) or give him your thoughts.
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Terry
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