Why do my option trades go against me?

[Mrtrader22]

Hey, my name is Josh, and I'm new here to elitetrader.

I would be happy if someone could hopefully give me some insight and point me in the right direction.

When I buy an option contract most of the time, even when the stock goes in the right direction, the contract still loses money?

Why?

I don't understand, and I am kind of confused?

Even if I buy a call contract for example, and the stock goes up, I still lose money?

I mostly just trend trade and ride the momentum of the market.

If anyone could give me any insight, or advice, I would be very appreciative.

Thank you.

-Josh

 

[Dael]

You've missed the ABC of options trading. You suffer from time or theta decay, which drain the price of the option while the time goes till the expiration.

Take a look at video of OptionAlpha
http://www.youtube.com/watch?v=4X3HBFntkds

or read a little at OptionMonster
http://www.optionmonster.com/education/options_pricing.php

 

[VanishingMediator]

Just to note though, if you are closing trades within a single day and not trading within 2 days of expiration, time decay should not be a large factor if they are going in the right direction. Give us an example of one of your trades?