Trading stock options is considered one of the riskiest venture practices nowadays. Option trading is basically exchanging contracts at a desirable price. The price of the option is calculated by multiplying the number of shares by the number itself. Basically, there are two categories of options. These are called put and call option. Thus, in this process there are buyers and sellers involved. They all take part in the trading market. The buyers were given the right to exercise buying in the end of term but are not obligated to do so. On the contrary, sellers are obligated to sell because they have acquired in limited time.

Basically, there are two kinds of options. The first one is the American Option where in the buyers and sellers are allowed to use their option at any preferred time before the specified date. This option gives the seller an edge since they can sell at any time they want. Meanwhile, the second is European Option which let the traders to buy or sell at the stated date only. In here, it is more advantageous for buyers because they have them at high value. When the stock option is at its expiration date, its price is higher. The price before that date is called "in the money". While the opposite happens for put option, the difference between the two occurrences is called intrinsic value.

Further, options are always open for speculation in the online trading market [http://foreigncurrencytrading.net/]. Since options are being bought and sold out every now and then, investors do employ good strategies to combat a bad market. It is advisable to have investing software that will aid the success of investment. An investor does not have to be a genius in the field of Mathematics or Statistics but knowledge in using the Microsoft excel for testing the strategy is enough.