Naturally, everyone wants to learn how to spot a huge options winner. However, this task is no easy feat. The natural recourse of stock trading always evolves within these elements- anticipation and perfect timing. Many rookie traders tend to believe that every trade is a big winner. On the contrary, this may not seem to be the case.
Many players tend to ignore small profits, all because they want to generate income right away. On the other hand, with the current situation in the market, you have to think twice before earning big. Re consider small profits in the process. Besides, it is better to play your game by trying to make both ends meet, be it through big or small income.
Many have also relied on good research as a means of learning how to spot a huge options winner. Better think again. Research is good but it does not deliver everything. Remember, market players also play it big and with multi-corporations setting in, do not expect to equate your own research with theirs.
So, how can you spot a huge winner? Why not give in to the following signals:
First, maximize your technical know-how by acquiring vital information. Learning the tricks of the trade is essential. You want to earn money? Then you have to know how. Study your stocks’ profit margin through available earnings report. Any company, whose stocks relatively earn a decent amount of revenue, is a winner for sure.
Second, when a specific stock sector is in expansion mode, it is likely that you are bound to spot a huge options winner. An expansion in every known sector or industry is always welcome, as it merely represents growth. Chances are there will be more income generating opportunities, benefiting investors and traders, in general.
Third, when a specific stock recovers from sell-off point, it means that such stocks recovered its losses, faster than any other stock options. This may take place within the day or the next, depending on price movements. In addition, it also pays to look for big down days or trends in the market, as potential big winners normally suffers a low down before hitting the jackpot so to speak.
Let us say the Dow Jones is down by 100points today, and the stocks are up by a mere 10 cents, this can still be a winner, provided that movements of said stocks are similarly patterned for the next one or two weeks. As pundits put it- repeated patterns are also indications of possible options winner.
Fourth, potential winners may also spring from seemingly one-time big earnings. For instance, if a company earns big the first time and achieves the same thing within two or three months, chances are funds will accumulate and bring eventual rewards. On the other hand, while this ‘earning’ event may not happen the second time around, it is still recommended to take notice and be vigilant.
Learning how to spot a huge options winner literally takes time. No book or research can simply prepare you with everything that is about to happen in real life. Options trading and investing in stocks involve great risks as much as it brings great rewards. In the end, your decision-making skills will aid you when to invest and how.
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