My Boy Wanna Traded In Options But Dunno Squat About Stocks! (ADVICE NEEDED)

[APOPHIS]

A friend of mine has these "ballin' ambitions" about making money in the market through trading options. This is a cat who invested $2000 dollars in the stock market and lost half of it in about 3-4 months time.

Earlier today we're chatting on the phone and an he's talking crazy talk. This guy is talking about saving his money to make moves through options trading which he has very little knowledge of besides video clips posted on youtube. He barley understands the fundamentals or the math of the stock game, he knows nothing about earnings, net profit margin, beta, p/e ratio, dividends etc, etc.

How the fuck do I set his him straight?

....Or should I just watch him falter. Again....

 

[deonjr212]

Tell him pad his option trades with shorts. That way he can't "lose". It's actually the way the big boy's play.

In order to trade buy option's you have to qualify though, you sure he's that inexperienced?

 

[APOPHIS]

Tell him pad his option trades with shorts. That way he can't "lose". It's actually the way the big boy's play.

In order to trade buy option's you have to qualify though, you sure he's that inexperienced?

Very inexperienced.
I basically see it as him skipping algebra and going straight to calculus while failing geometry in between. Cubs don't hunt with the pride unless they've gained the knowledge.

What does it take to qualify?
Personally, I know very little about options.

 

[Damian Stone]

A friend of mine has these "ballin' ambitions" about making money in the market through trading options. This is a cat who invested $2000 dollars in the stock market and lost half of it in about 3-4 months time.

Earlier today we're chatting on the phone and an he's talking crazy talk. This guy is talking about saving his money to make moves through options trading which he has very little knowledge of besides video clips posted on youtube. He barley understands the fundamentals or the math of the stock game, he knows nothing about earnings, net profit margin, beta, p/e ratio, dividends etc, etc.

How the fuck do I set his him straight?

....Or should I just watch him falter. Again....

Well you should gear him towards educating himself, when I started trading options I did not know much about them either and there was not that many places to learn unlike these days with the internet age.
HE either will be a good learner or learn his lesson and give up.

 

[ScorpDiesel]

http://www.investopedia.com/
http://www.morningstar.com/