Yesterday afternoon I made my first trade. I figure the only way to learn this stuff is by doing it, so I took the plunge.
The newsletter suggested that Mattel would be a good stock that will go up, so I focused on that to start with. I don't have a lot of money to trade with, so I wasn't sure about spending around $2000 just to get 100 shares of Mattel stock.
So I decided to get an option instead, mainly because it is cheaper. I have learned that you buy a call when you think a stock is going up and you buy a put when you think a stock is going down, so I got a call at ninety cents, which actually cost me $90. (or to be more exact $92.96 with the commissions and everything)
This is a call for March 2010 with a strike price of twenty dollars. So I am hoping this stock goes up a lot so I can sell the call for a bunch more than I paid.