Investing and Financial Markets

What is options investment?

Answer

User Avatar
Wiki User
09/26/2009

Options investment or options trading, is the buying of options on stocks rather than the stocks themselves. Owning the rights to buy or sell the stocks at a certain price allows you to control the same amount of shares at a fraction of the price, hence LEVERAGE. Yes, the main beauty of options trading is leverage. When your "bet" is correct, you can make as much as 100% return when the stock moved a mere 10%.