Why Is Wall Street Not Talking More About Options Trading?
There’s no denying the popularity of options trading these days. Just go to a bookstore (if they still exist in your neighborhood) and see how many books there are on options. Or, do a Google search and check out how many newsletters and services are based on options trading.
The fact is, options trading has grown exponentially over the last decade. But… when’s the last time you heard a Wall Street analyst tell you to go trade options?
Sure, CNBC has their “Options Action” show. If you’re lucky enough to catch it, it’s a mere thirty minutes, and you’ll maybe hear about three trade ideas. CNBC had no choice to do something with options given the industry’s immense popularity.
So why aren’t more Wall Street personalities talking about options? Why aren’t there more mainstream articles about options trading and strategies?
I’ll tell you why…
Because options even the playing field.
Wall Street doesn’t want you to realize how powerful options trading can be, because it takes away their advantage. You see, options combine leverage, risk control, and flexibility into an easily accessible yet highly powerful product for the masses.
Strategies which only used to be available to Wall Street traders and institutions are readily available to all of us through options. Let me tell you, those Wall Street guys can’t stand sharing the wealth!
And that’s not all…
Before options became popular, most retail investors only traded stocks (and many still do). While stock trading has its benefits, Wall Streeters are getting away with grand larceny as they scalp your stock trades.
By now, many of you have heard of dark pools. Most Wall Street banks have their own private exchanges called dark pools where they route their customers’ orders to. The dark pools are basically unregulated and trades can get filled at whatever prices the bank wants.
In other words, each bank is making millions off your stock trades by filling the orders at unfair prices.
With options, that’s almost a non-issue. Certainly, you want to get the best prices possible on options. However, options trading is so much more about strategy than price. A good options trade can easily make you 100%, 200%, or more. Pennies just don’t matter all that much when you’re dealing in thousands!
I’m not suggesting you completely ignore stocks. They still have their uses. But just remember, Wall Street wants you to trade stocks. They HATE IT when you trade options.
The more you understand and appreciate options, the less money on the table for Wall Street. And more importantly, the more money you make for yourself.
Yours in Profit,
Gordon Lewis
Category: Options Trading
