The most conventional way to take an opinion and carry it out in the marketplace has always been via the buying or selling of stock. You think some company or broad market is undervalued, you find the symbol and you buy 100 shares. While this may be the most effective way of gaining the bias you desire, it is oftentimes not the most efficient, especially for IRA traders.
Luckily, options present us with the opportunity to synthetically buy or sell stock without the inconveniences that come along with physically trading the stock.
Tom and Tony take this Strategies for your IRA segment from trading stock to trading options and options spreads.
Vertical spreads give us the chance to buy (long) or sell (short) a stock or broad market while (usually) only putting up a few hundred dollars per trade (as opposed to the whole value of the stock). Though this obviously helps IRA traders who cannot sell stock short, these strategies also reduce risk and increase potential returns on capital.
Find out how to carry out an opinion in the market without having to put up the full price of the stock to trade it.
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