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Stock options are viewed as complex and risk-filled investment tools by some people. Though they have risk, this trait is common throughout many kinds of investments. Options have improved greatly in 50 years and are now more widely understood. However, scandal has been responsible for some of that knowledge, making it more important to explain the reasons for trading options.

Today, I had an interesting conversation with an option trader who is still searching for the magic formula to making consistent returns with option trading. He said many things which were so familiar to me.

Most novice options traders don’t have a good grasp on Option Greeks, and they tend to only focus on the Greek we call Delta. Delta can be informative when it comes to our option position, but the best traders know to look deeper and will focus a lot on volatility in the stock market.

To generate consistent cash-flow from the trading markets with out having to ‘guess’ or know near term market direction, there are a variety of different option techniques that option investors can use.