An option is a bet that a specific stock, index, or future will reach or exceed a specific price within a specific time. Notice that the word specific occurs in it three times. You must choose the right stock, predict the extent of its move, and forecast how fat it will get there. You must make three choices - if you are wrong on just one, you will lose money.
When you buy an option, you have to jump through three hoops in a single leap. You have to be right on the stock or the future, right on its move, and right on its timing. Ever tried tossing a ball through three rings at an amusement park? This triple complexity makes buying options a deadly game.
Option trading strategies
