Making Money from Puts and Calls??

got it so cut your losses early rather than wait if i think the stock has no chance of going my way. So just one more quick question. If i purchase a call option for a 3 month period would the ask would be higher to suppose to a one week or one month?
 
Generally, yes. If implied volatility is the same for all of the expirations, than the longest expiration contract is going to be the most expensive. You can look at options chains on yahoo finance to get an idea of how price varies with time until expiration (Natebergs books have charts showing this... you can probably find them online).

I'm going to bow out of this conversation. You really should do some independant research though... the answers to all of your questions can easily be found on investopedia.
 
I'd also recommend thinkorswim paper trader.

I remember a few years ago when I was fooling around with what options we're. Think it was called "Thinkback" or something but you could basically go to a date on a chart, put your papertrade in with the historical spreads they had and then just go forward and watch how your position worked and how time decay and volatility played.

It was more interesting to see how the different strategies worked like condors and butterflies and straddles and calendar spreads.

If I remember it would show me my max profit and max loss for certain setups and such.
 
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