Stock Option Picks – Seek Out Good Tools, Not ‘Answers’
Many new investors, having gotten a taste of the potential for profits offered by trading stock options, begin to look for ways to automate the process of picking specific stock options contracts that might have a better than average chance of appreciating before their expiration date. With thousands of stocks having options issued on them and often dozens of combinations of different strike prices and expiration dates, it would be impossible to manually sift through every contract on a daily or even weekly basis.
When it comes to stock option picks however, let’s be clear: think twice before you let your desire for consistent options trading profits compel you to subscribe one of the hundreds of newsletters available on the Internet and elsewhere that promise you barely believable gains. I’m not saying that all of the advice one gets from people selling options picks is bad; I am saying that it is no automatic shortcut to options profits.
On the other hand, when it comes to finding profitable options trades there is no substitute for doing your own research. Listen to everyone, but look for tools that will help you reduce all the market data to trading opportunities that are especially promising, and assume responsibility for your own trades.
There’s little doubt that some investors have found methods to profit consistently with options, but let me ask you a question. If you found a way to reliably pick stock-option winners-I mean really reliably-what would motivate you to sell either your method or a roundup of weekly or daily option picks derived from signals as indicated by your method? Admittedly, selling stock option predictions to hundreds of people each month would represent an attractive income but it would not approach what you could earn for yourself if you had really found a way to make money consistently with options.
In this article, rather than pointing you to specific free stock option picks I’d simply like to remind you what is important and useful if you have made the decision to try to make money trading options for your own portfolio. It’s necessary to distinguish between offers to sell you investment advice on particular options, and offers to purchase or subscribe to tools to help you make your own decisions. Covered call screeners and many other types of option trading software fall into the latter category and are worth learning about.
While these tools imply that you’ll have to do your own work I would suggest that buying tools or access to tools that help you responsibly arrive at your own stock option picks (and hopefully learn from your own mistakes) is more viable than making a leap of faith and paying for dubious advice. There’s a reason for the familiar disclaimer in the fine print of every financial prospectus: “Past performance is not indicative of future results.” It’s there because it’s true! Start your options trading journey by getting stock options explained properly.