Crypto volatile again, Whats stopping you from trying Options Trading?

[vennali]

can someone suggest me some books or videos, as well as strategies for trading options? Thanks.

Here's the basic Options training by Investopedia. They also use examples to make you understand in a simple yet effective way. Sparrow Exchange is working on creating their own content for new traders interested in trading options. Will update it here whenever they do release it.

For books, You could try Understanding options by Michael Sincere as well as When Genius Failed - Roger Lowenstein.

[teddybear]

can someone suggest me some books or videos, as well as strategies for trading options? Thanks.

Here's the basic Options training by Investopedia. They also use examples to make you understand in a simple yet effective way. Sparrow Exchange is working on creating their own content for new traders interested in trading options. Will update it here whenever they do release it.

For books, You could try Understanding options by Michael Sincere as well as When Genius Failed - Roger Lowenstein.

Thanks, I'll look into it. Is there any promotion going on, on Sparrow?

[vennali]

We've had a few contests on our social media and a couple of contests as well. Currently there arent any running but join our social media for updates.

[senne]

Option trading is indeed better than futures trading when it comes to limiting the risk. But I am not a big fan of option trading because of the incredibly high volatility of cryptocurrency. I usually trade options in case I want to hedge my risk and I will still prefer it for the same. One wrong trade in option with leverage can ruin the whole portfolio. Unless you're good at day trading, one should never trade options or for the matter futures.

[ChrisPop]

In time I've learned that options is a whole different game and I don't recommend anyone using them until they don't have a good grasp of basic technical analysis. Futures and options are derivative products that hold their own intricacies and they can confuse the hell out of a newbie trader especially on an emotional level. I view trading as a leveling system if you really want to use derivatives. So once you've mastered technical analysis and risk management I'd move on to using futures and then options to maximise my potential 

[vennali]

In time I've learned that options is a whole different game and I don't recommend anyone using them until they don't have a good grasp of basic technical analysis. Futures and options are derivative products that hold their own intricacies and they can confuse the hell out of a newbie trader especially on an emotional level. I view trading as a leveling system if you really want to use derivatives. So once you've mastered technical analysis and risk management I'd move on to using futures and then options to maximise my potential 

It can be a little intimidating in the beginning but thats what we are looking to change. A very simple UI to help new traders understand what they are getting into. Trading options doesnt always have to be about making big bucks with technical analysis. You could make sell calls and try to earn weekly premiums, which could get you up and over 200-300% profits annually. All without really breaking a sweat.

[vennali]

8x profit in a bear market?!

Just last week, a Sparrow user shared his profitable trade with our Telegram community. How did he manage to do it?



Here's the article from Sparrow Exchange's medium page on how he managed to pull it off.

[The Cryptovator]

@OP, I know trading is more effective during volatility, but it doesn't mean your calculations and methods will work your favour always. Don't forget that when you buying then someone is selling on the other end. That's trading and everyone could not get profits always. We don't know that bitcoin would dump exactly from my buy point, does anyone know it. And that's how traders losing. However, if someone could play with patience then there is very low chances for loss. And during volatility trader have to trade with extremely caution.

[vennali]

@OP, I know trading is more effective during volatility, but it doesn't mean your calculations and methods will work your favour always. Don't forget that when you buying then someone is selling on the other end. That's trading and everyone could not get profits always. We don't know that bitcoin would dump exactly from my buy point, does anyone know it. And that's how traders losing. However, if someone could play with patience then there is very low chances for loss. And during volatility trader have to trade with extremely caution.

You could use Options trading like insurance, while capitalizing on the volatility and earning some premium while being on it.

[gabbie2010]

Option trading works better using a higher time frame at least using a daily time frame as a reference point just as the OP analyzed while capitalizing on the market volatile of crypos in recent times especially ethereum that fell deeply in the last couple of days however to have an edge over the market an option trader must have deep and sound understanding of Technical analysis else trading without that knowledge and skill amount to trading option like a gambler.
More so a sound money management is the key to being profitable in the long run based on brokers with a higher percentage pay out or returns just like sparrow.

[teosanru]

Here are some benefits of Options Trading, especially in a volatile market like Crypto:
Leverage and limit risks while getting higher potential returns - Option trading is very attractive for small pocket traders. By taking position in options, one can reduce the cost significantly.
For example,
It's Monday. BTC @ 10k
You buy a put for 1 BTC @ 9k expiring on Friday for $100
[if BTC falls below 9k, you can force someone to buy your BTC at 9k]
Wednesday, BTC flies up to 13k. You won't get stopped or liquidated. You are fine. Keep sipping your cocktails.
Thursday, BTC flies down to 7k. Still not your problem.
Friday, BTC settles at 8k at 4pm Singapore time.
Your profit is: 9k (strike price) - 8k (settlement price) - $100 (cost of premium) = $900
$900 profit from using $100. 9X return.

In the alternate scenario, BTC settles at 20k. Your maximum loss is still 100$.

Works in different market scenarios - One of the key advantages of options trading is the flexibility of changing strats as per different market conditions. There are various strategies for all kind of markets, whether bullish, bearish or sideways

You can hedge your trades to protect them from incurring losses.

Remember, shorting is a dangerous game, why not try options and limit your risks peacefully?  

Pretty well said, but problem here in crypto market is volume in the options. I barely know only bitmex allowing you with options for Bitcoin and a few cryptocurrencies and these are traded with pretty less volume. Which means even if you think that you have made a wrong choice and you want to exit the whole scenario with a loss you just can't. I hope you know that most people make their fortune using option selling and not buying because decay of time is in your favour. But in crypto these types of option selling is impossible because situations may come when you might even be unable to sell your option at Stop loss. Shorting is a much more safer game when it comes to option.

[vennali]

~snip~

Pretty well said, but problem here in crypto market is volume in the options. I barely know only bitmex allowing you with options for Bitcoin and a few cryptocurrencies and these are traded with pretty less volume. Which means even if you think that you have made a wrong choice and you want to exit the whole scenario with a loss you just can't. I hope you know that most people make their fortune using option selling and not buying because decay of time is in your favour. But in crypto these types of option selling is impossible because situations may come when you might even be unable to sell your option at Stop loss. Shorting is a much more safer game when it comes to option.

Although we are still pretty new into the market,  you should check Sparrow Exchange. We traded over 2million USD during one of our contests.

[vennali]

Shorting got you REKT? Try Put options.
Feeling bearish and want to profit from a potential fall in asset prices, but getting rekt by a rough market? You may be better off buying Put options than short selling.

Don’t get REKT by crypto volatility

Read more on Sparrow's Medium Channel.

[el kaka22]

My level of skill set in analyzing and predicting the market fluctuations. Crypto volatility is back? I wonder when it was gone? The range of market fluctuation may vary but crypto markets are so far always volatile and for those traders who are good in predicting short term truing points, it is always a good market to trade with.

I never touched options trading. It is a headache to bother about its expiry. It means you must close your trade within that time frame whereas spot trading has nothing such a limitations. You can hold as long as you prefer like you may wait infinitely to book your profits. Now, tell me why should I try option trading even it would be capable of producing 10x profits in short time. Making profits in tension free way is a blessing and it might be equivalent to a regular day job (even you may not get your salaries at the month end, you will get paid for sure, just keep working on as your daily routines along with your all fun and with family times.).

[BitHodler]

Crypto volatility is back? I wonder when it was gone? The range of market fluctuation may vary but crypto markets are so far always volatile and for those traders who are good in predicting short term truing points, it is always a good market to trade with.

People here only know how to utilize large price swings.... the moment you see the range is tightening, people will pop up complaining about how boring the market has become.

It's clear that they haven't traded any legacy assets before, because what's considered a huge price swing in gold or the stock market, makes people in crypto yawn and wait for a larger price swing to trade it. It's pathetic to be honest.

For the most impatient traders there is such a thing called leverage trading.... if you think the price swings aren't of any significance, crank up your leverage count and show how big your balls are. Don't cry when you get liquidated.

[vennali]

Feeling bearish? Buy a Put option.

If you think prices will move down, and you want to short the market but worry about forced liquidations or do not want to deploy your full capital, you can still participate in the market movements by buying a Put option.


Why buy Put?
Read about it in detail only on Sparrow's Medium page

[vennali]

🎉Quarterly (3 months) & Half Yearly (6 months) options are now available on Sparrow!

Customize your trades today with our Weekly, Quarterly and Half Yearly options.


👉 www.sparrowexchange.com

[Murat]

I think this is the harsh reality of this system, price volatility is the general term of this system because this is not a stable platform even there is no control of anything. I believe that a set of proper regulation could bring a positive change in this system, but still, trading is profitable for me, I think trading could bring to you a huge profit if you can manage it properly, so there is nothing to prevent you from stopping option trading, a tight passion could be the main thing of successful trading, It's true that cryptocurrency is facing always a price volatility so don't be panicked and don't attempt to panic sell, Because it's temporary situation. so let's set a plan for further trading.

[Pearls Before Swine]

Options never interested me in the stock market, and in my opinion they would be pointless to trade in the crypto market since I don't have an inkling as to where bitcoin (or any other coin) is going to be at the expiration of the contract.  It's all guesswork to me, and I would rather own a coin than simply bet on where its price is going to be.

But I can see how options would appeal to gamblers, and there certainly are a lot of those in cryptoland.  Bakkt is supposed to be a way for the big boys to bet on bitcoin, tho I don't think they've reached their potential yet.  They probably don't like guessing on the price of something they have no good way to analyze.  Anyway, anyone trading options ought to be very careful about leverage, because things can get very ugly very quickly the more leverage one uses.  The exchanges love it, but its the traders that end up getting screwed.

[level01]

For the most part, options contracts traded in large exchanges and OTC markets that have market liquidity are not directly accessible to retail individuals. Instead, these retail individuals have to make trades through a broker or brokerage firm that has access to the exchanges or OTC markets.

Level01 allows users to trade options contracts directly with one another peer-to-peer (P2P) without the need for an intermediary broker; with a proprietary system that was designed to leverage blockchain, cryptocurrency and smart contracts technology for automation and transparency in market data, trade contract intent & matching, transactional history, and trade profit settlement.

For improved efficiency, peer-to-peer trade matching on the platform is assisted by a specially formulated algorithm ‘FairSenseTM’, which analyzes trade intent patterns of users on the platform and matchmakes or suggests them to counterparty users.

So, nothing can stop you from trying options trading now.