Resources for Options Trading

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When looking at resources for options trading, gather information on your income and tax statements before visiting with a brokerage firm. Learn how risky options trading can be before investing with information from an investment portfolio manager in this free video on investing and personal finance.

Part of the Video Series: Investing & Personal Finance Tips
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Video Transcript

Okay. Resources for options trading. My assumption is that you're asking what are the resources or the assets that you need to have in an account so you can go forward with the options trading. And a lot of times what will happen when you ask for options trading privileges from a brokerage house, they're going to give a series of questions. And one of which maybe be about your income, may also be a measure of how much money you have in your account. Options trading if done improperly, you make a bad call, can be quite costly. So you want to make sure you can actually absorb those hits. Options trade sometimes move very quickly and they can be quite expensive especially on the down side. So your resources or your assets that you have may come in to question with the brokerage house. And different brokerages have, there's some standard federally regulated questions that need to be asked but there's also within their own brokerage institution, they may have more stringent or looser requirements. And, again, that may call in to question either your assets or your income that you have. So, when you're giving this information or you're ready to ask about options trading, first thing to do, make sure you have your information pulled together. You know, concise and detailed. Make sure that you have your income. You may need a tax statement from the year before. But just make sure that you have all your information so that you can answer the brokerage's questions right away. If they feel it's suitable for you, then you can be on your way trading options right, as soon as possible.

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