Everyone likes to have options. Like the option to buy or sell stocks at a pre-determined price between now and future date no matter where price goes. Owners of stocks use equity options to hedge their positions and speculators use equity options to speculate on the future prices of stocks.

We are going to teach you how to use equity options to speculate on the future prices of stocks while limiting your risk and capital requirement. To do so, we must first become familiar with options. The first few lessons will do just that.

Many investors who like to trade small-cap stocks may be surprised to find that equity options can be a great investment tool. Options offer many advantages, such as:

• The ability to hedge small- cap portfolios
• Invest in large-cap stocks with leveraged capital
• Invest in high-probability, low-risk strategies
• Profit from sideways and downward markets
• Generate high percentage returns just like small-cap investments

Equity options fall under the derivative category because they ‘derive’ their value from the underlying instrument. The value of these contracts is constantly fluctuating with the value of the underlying asset.

Originally introduced in 1973, equity options have exploded onto the investment scene with over 2.8 billion contracts traded in 2007 alone. Investors use options in a number of scenarios. Most specifically, they are used to hedge and speculate on the future value of everything from the Dow Jones Index to spot Gold prices.

Our Options 101 Education Series will introduce you to the basics of equity options and how to utilize them correctly. Once you begin to realize the power of options, you will no doubt wonder how you ever lived without them! So get ready for an education series that will change your entire perspective on risk, allocation and investing.