So much for the wisdom of having multiple streams or multiple sources of income, which I'm certain anyone
would strive to achieve if one knows the means of doing so. As featured in the bestseller "Rich Dad Poor Dad", author
Robert Kiyosaki says "The poor and middle class work hard for their money. The Rich have their money work hard for them." So, people
who work hard for their money are those who work countless hours per week, in order to earn a fixed amount of monthly income.
How about those who are able to have their money work hard for them? How do they do it? Poor Dad.. Focused only on academic
literacy. Rich Dad... Focused on financial literacy as well as academic literacy.
Another well-known book ... "Think and Grow Rich" by Napoleon Hill mentions about success being achievable
by the right mindset, the right knowledge, and the right vehicle. Specialized knowledge is something that not everybody has,
so that's why it is specialized. In many cases, it requires a combination of cost, effort and opportunity in order to attain
specialized knowledge.
The evolution of the internet creates many more opportunities and transformations in almost every field
of expertise, be it in the field of marketing, sales, trading, education etc.
Nowadays, more and more retail stock traders have online brokerage accounts which are directly accessible
to those who have an internet connection and an online brokerage account. This of course would mean that the average trader
nowadays will need to be in the know-how of the modern IT-related tools, such as usage of software to provide charting visuals
for technical analysis, executing orders to buy or sell, setting or programming criteria for advanced orders to be executed
or cancelled, or even just simply browsing websites to research information related to a stock symbol as a basis to know how
strong or weak a company is, the numbers behind the company, and when certain news driven events related to the company will
take place. All these are influential to the decisions the trader will make.
However, you may ask... where do I start? Perhaps you may want to self-learn, given that the internet is
a myriad of information. Simply
google "options trading" and a whole loadful of results will appear.
You might ask... Can't I just invest with a fund manager, or simply park my investments
with financial instruments such as fixed deposits, or bonds, or get a fund-manager or an investment professional to invest
for me?
The answer to that is simple. There are people who prefer not to self-direct their own accounts, and they
leave it to the professionals such as fund-managers. As these are professionals in the industry. It's a matter of choice.
However, if you have the knowledge of generating weath, self-directing your account may be a better choice, after all...
the best person with the best interest of growing your money is actually you. This simply boils down to growing your
money at a quicker rate, and of course the opposite, pulling out money when they are supposed to be pulled out.
Why trade options instead of stocks?
Options are a type of instrument derived from stocks. Many traders would choose to trade options because
lesser required capital and higher leverage. Higher leverage because as the stock price moves, the percentage gain obtained
from the options would be a magnitude higher than the percentage of the stock movement. Therefore the percentage gain from
trading the option is higher than the percentage gain from trading that same stock. That's what leverage is all about. Also,
given that lesser required capital to buy option contracts than stock shares, one can diversify the capital's portfolio much
more.
Given that there are so many internet websites that provide good explanations of what Options are, I shall
not replicate it in this site. I particularly like
Investopedia's tutorial on options which is a nice and comfortable read for any beginner.
Perhaps you do wish to learn how to trade, and would be interested to attend professional courses out there
- and learn to trade like a professional. That would be a great idea, and worthwhile to check them out!
You may come across some of the leading options trading courses conducted in our AsiaPAC region, e.g. Wealth-mentors,
Freely, Adam Khoo's Wealth Academy, Optionetics..
I would recommend you as a beginner or newbie to check these courses out, and consider attending one to
get you started.
Do note that signing up for coaching for any course from anywhere wouldn't guarantee that you'll
be a successful trader. It's similar to signing up for tennis lessons doesn't guarantee you'll be able to win the
game against other players straight after the course. But the plan is that you have a starting point where you can start developing
skills and strategies based on what has worked with others, and discover what works with you.
It is vital to develop trading skills PRIOR to funding and trading Live Capital in your
brokerage account. Use your virtual account, and take your time!! Ample practice in a simulated virtual account is definitely
part of the curriculum, as you need to systematise your trading, and also master the skill of capital preservation and managing
the risk, before you are ready to go Live. If you want to trade straight-away without the practical skills, I suggest
u go to a casino in Macau, or Las Vegas!!
Well, finally ... if you know of someone who is successful trading with the stock market, one might
label him or her as 'lucky'. Is Luck involved? Perhaps. You be the judge....
"I feel that luck is preparation meeting opportunity." -Oprah Winfrey
"L.U.C.K. = An Acronym for... Learnt to Use the Correct Knowledge"
Here's wishing you LUCK!! :-)
