You wouldn't take a yacht on the open sea without learning to sail, nor can you trade options without knowledge of derivatives and skills to operate within the market. Like sailing, trading options isn't something you learn overnight. Trading options involves considerable risk. You risk your life, when you sail out to sea and you risk your money, when you trade options. You must study the subject in depth and develop trading skills, if you wish to become a successful options trader.

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[edit] Steps

Learn to talk the talk. Look at this website, and print out the entire Options Dictionary. Insert the pages in a three-ring binder. Start studying.
When you thoroughly understand the options terminology, begin reading books that cover the basic techniques and strategies for trading options. There are many books from which to choose. Two suggestions are:
- High Performance Options Trading: Option Volatility & Pricing Strategies by Leonard Yates
- The Option Trader's Guide to Probability, Volatility, and Timing by Jay Kaeppel
It is critical you understand technical analysis. Learn to interpret charts, if you want to successfully trade options, regardless if you plan to trade equity, index, currency or any other type of option. Here are some great resources:
- Technical Analysis Explained 4th Edition by Martin J. Pring.
- Technical Analysis for Direct Access Trading: A Guide to Charts, Indicators, and Other Indispensable Market Analysis Tools by Romeu Umar, Rafael/ Serajuddin
- New Frontiers in Fibonacci Trading: Charting Techniques, Strategies & Simple Applications by Michael Jardine
You will find a wealth of information on the Chicago Board of Options Exchange web site:http://www.cboe.com/ Click on the Learning Center. Start with the Options Institute. Study the free Online Tutorials.
Enroll in CBOE's The Options Primer online course, which consists of three interactive modules: Option Basics, Profit & Loss, and Investment Strategy. The material explores in-depth options concepts and tests your knowledge as you learn at your own pace.
View CBOE's Options Webcasts that allow you to interact with the instructor.
Attend a CBOE 1, 2 or 3 day Options Seminar. You will find information at: http://www.cboe.com There are seminars from Basic to Advanced, depending on your level of knowledge. In addition to the seminars offered by the CBOE, you will find advertisements for other options training seminars in the Wall St. Journal and Investor's Business Daily.
Open a brokerage account. Your account must be specifically an options trading account and you will require approval by the firm's Option Principal to trade options. If you have no experience trading options the Option Principal will not approve strategies beyond writing covered calls to begin. As you gain experience you can request permission to engage in advanced option trading strategies.
Read and understand the Risks and Characteristics of Standardized Options, a booklet written to meet the requirements of an SEC rule. In compliance with the SEC rule, brokerage firms distribute the booklet to those who open an options trading account.

[edit] Tips

Practice paper trading before you risk your money. Stocktrak.com http://www.stocktrak.com is one site that allows you to practice trading stocks, options, and futures.
Never use more than 20% of your cash to trade options.
Never use money to trade that you cannot afford to lose.
It is helpful to have a margin account, however, depending on the amount of cash and equities in your account, you may not be granted approval to trade on margin.
If you do trade on margin, always be prepared for a margin call.
Option commission rates vary. Compare rates and services before opening an account.
Check the brokerage firm's execution rates and reliability. How fast trades are executed can be critical.

[edit] Warnings

As with any trade, options involve risk.
And as with any trade, you stand to lose all the money you use to trade options.

[edit] Things You'll Need

You need... no, you MUST understand Stock trading before you try to trade Options. Options *Magnify* the movements that stocks make, making a 5% move into as much as a 50-100% move! If you lose 5% when you try trading a stock, you could lose everything trading its Options.
Trade stocks first. If you consistently earn returns, then consider moving to Options. If you lose money in stocks, you'll lose everything with options.