Is Day Trading AAPL Options a Smart Investment?

2018-06-21 | Simpler Trading Team

If you’re an trader interested in tech companies, you may consider day trading Apple (AAPL) options. Apple is one of the most profitable companies in the world with its stock price increasing daily. While many people want to invest in Apple, most find its stock price to be out of their financial reach.

If you fall into the above category, here’s a possible solution. Day trading.

The trick is that day trading AAPL options allows you to take advantage of increases and decreases in its stock price.

What does Day Trading AAPL Options Mean?

When you buy an option, you buy the right to purchase shares of Apple stock at a set price or to sell shares of Apple stock at a set price. You don’t have to actually buy the stock, but instead, you buy and sell its options. If the stock price increases and you have an option to buy shares at a lower price, then you can make money by selling that option.

Is Day Trading AAPL Options a Smart Choice?

Whether or not it’s a smart investment choice to day trade AAPL options depends upon your risk tolerance first and foremost. It also hinges on whether or not you believe you’ve got a grasp on which direction the stock will go.

Options increase or decrease in value as the price of a stock changes. This means that if you plan to day trade, you want to be sure that the stock price is going to change enough in value that your options contract will increase in value. So you can sell it, cover the cost of commission, and make a profit.

How to Decide if Day Trading AAPL Options is Right for You

As a trader you need to make a decision about the level of risk you wants to take on, and the level of risk you’re willing to assume to achieve potential gains. Day trading can allow you to make money, but there’s risks associated with making this type of trade. It’s best to learn as much as you can about trends in Apple stock and about the options market in order to decide if day trading options is right for you.

Services, such as Simpler Trading, can help you become more informed. This will enable you to make a wise investment choice about day trading AAPL options.