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Currency Last % Change USD/EUR 1.34 0% USD/GBP 1.544 0% EUR/GBP 1.152 0% GBP/EUR 0.868 0% 
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about 1 year ago
Ask yourself how much are you willing to loose? Remember nothing is guaranteed in the stock market and only you know what you are willing to risk.
about 1 year ago
Yes, options trading is all about using only as much as you are willing to lose. So, if you are only willing to lose a maximum of $500 per trade, then you should at least prepare a portfolio of about $2500 so that you can make at least 5 trades in all instead of losing everything in one go. Of course, the more fund you have, the better and the lower the risk if you use no more than $500 per trade.
about 1 year ago
If you fully understand the impact of the “Greeks” with options, I would start off with 10% of the portion of my portfolio dedicated speculative trading. So… if I have 5% of my portfolio dedicated to speculative investments….. and that was $50,000…. I’d invest $5,000 in Options.
(I’m also assuming that you use good position sizing and money management techniques)
about 1 year ago
I’d start with 10% in speculation, and get comfortable with trading options. There are many naysayers to options trading, but that is because they do not understand how to use options to reduce the investment risk of stocks. Instead, they typically buy cheap out of the money options, hoping for a big score, which almost never works out.
The sophisticated option trader trades calendar and vertical spreads, and learns how to make money form the time decay. Additionally, you learn how to substitute an option position for a long stock position, and further enhance risk management by reducing the amount of capital at risk.
about 1 year ago
Hey, why don’t you try stock robots?
I’m assuming you know what I’m talking about. If not, let me take a second to fill you in.
There’s a site on the internet that claims to have invented a robot that can pick winning stocks. I was skeptical at first but I tried it. And I SWEAR it’s the BEST investment I ever made! I’ve made $47350 so far since I started a few months ago.
The best part was I threw my resignation letter at my boss’s face and showed him the middle finger.
Check it out here: http://alturl.com/8erb
It really works and guarantee to work. Read this report to learn more:
http://www.pennystockprophetreviews.com/
about 1 year ago
There are no “rules of thumb” that I am aware of that would provide you with the answer. Even when constructing conventional portfolios it is wrong to follow such rules if they don’t match your objectives and risk tolerance.
You have probably hit the nail on the head when you suggest that you should only invest as much as you are prepared to lose – determine that figure and then stick to it, come what may. That may be harder to say than actually achieve, investor psychology indicates that we are bad decision makers when experiencing losses.
There was some research done by Man Group several years ago regarding the level of “hedge” fund investment that could be added to a portfolio to provide a combination of more predictability of returns and lower volatility, I think that a minimum of 10% of the portfolio was needed in order to show a difference. Options trading is a different kettle of fish but could be used as part of an overall hedging strategy.
Disclaimer:
The answers above are for guidance only and should not be acted upon without you receiving independent financial advice relevant to your circumstances. To find and IFA please go to http://www.unbiased.co.uk