Reader Comments

Brit Method

by marven dwayne (2019-02-28)

The other rule that has gotten people into trouble in the past Brit Method is that options contracts expire. You have to remember that when you are buying an option, which gives you the right to buy or sell an underlying instrument, you must exercise your rights spelled out in the options contract by a specified date. You can lose out on the benefits of owning the option if you don't exercise it on or before the expiration date. Especially if you are purchasing index options you also need to check to see if the option is American style or European style. With American style options you can exercise your option contract anytime before the expiration date. On European style options you can only exercise your option on the expiration date of the option. You cannot exercise your rights in the contract before the date the option expires with European style options. It may sound kind of complicated right now, but it really isn't. It doesn't take much to check on the option before you purchase the option. I firmly believe that options' trading is a very good way to manage risk when investing in the stock market. It is well worth the effort to learn and use options' to manage your risk. There are many good products out on the market to help you learn.