This is the first article of a series, “How to trade options”, which explains how to trade options and what they are. First of all, we explain here the basics of call options and put options.
Options are a way to gain a profit in a market that neither constantly goes up nor goes down. With a long-lasting market trend such as stocks after 2008 or gold after 2012, bullish or bearish, you may simply buy or short sell a financial instrument.
On the other hand, when you know a market will not move for a while or when you know it will be volatile but do not know if it goes up or down eventually, neither buying nor short selling will give you any profit. However, with options, you can gain a profit even in such a market. This is why we explains here about options.