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Options Trading for Beginners: Where to Start

In the interest of illuminating options trading for beginners, here are a few strategies (and Advisories) to consider starting with.


For years, options trading was thought of as a high-risk investing strategy that only a Harvard/MIT math major could successfully use, and there was a shortage of information about option trading for beginners. That narrative has very quickly been debunked as more and more average investors have learned about the risks and rewards of options trading, and have embraced this strategy in their portfolios.

So, if you are new to options and intrigued by the potential and want to learn more, where would you start?

While I am a bit biased, I would look to one of the many options services that Cabot offers. That way you get to learn from an expert like myself. For example …


The most basic of options strategies is the covered call/buy write. The nuts and bolts of this strategy are you own or buy 100 shares of a stock, and then you sell a call option against that stock holding so as to collect a call premium.

For example, you could buy 100 shares of Apple (AAPL) and sell 1 call for $5 (which is actually $500 that you collect).

A covered call is a very safe strategy and is actually a way to reduce your risk.

I sell calls in the Cabot Profit Booster portfolio, where I recommend one such trade every Tuesday morning based on fellow Cabot Analyst Mike Cintolo’s stock recommendations. This portfolio is an ideal introduction to options trading for beginners because it couples Mike’s top-notch research with simple, actionable option trades.

If covered calls aren’t your cup of tea, the next most basic of strategies is buying calls/puts as a way to get bullish or bearish exposure.

The advantage to these strategies is you use the power of options, which is leverage, to get upside or downside market exposure.

For example, instead of buying 100 shares of Microsoft (MSFT) which would cost you $40,000, you could buy 1 call option that might only cost you $2,000, and get similar profit potential should the stock rally.

At Cabot Options Trader we use call/put buying, as well as execute covered calls. Plus, you get a detailed explanation of why I recommend those trades including the risks/rewards, updates on where we stand with those positions, as well as access to my email if you ever have any questions, and so much more.

Finally, if you are ready to take the next step, and it’s a big step, you can add your name to the waitlist for Jacob’s Private Circle (JPC). This is a super small group of traders executing both basic and sophisticated options trading strategies (iron condors/diagonals/etc.).

Stepping back, in the over ten years I’ve been at Cabot I have seen the options world explode in popularity. This breakthrough in options trading joining the mainstream investing world, along with the countless traders I’ve taken from beginners to intermediate to pro levels has been extremely rewarding.

If you are interested in learning about options trading, now is the time to join the party, and Cabot is a great place to start.


Jacob Mintz is a professional options trader and editor of Cabot Options Trader. Using his proprietary options scans, Jacob creates and manages positions in equities based on unusual option activity and risk/reward.