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Should a Beginner Start with Options Trading?

I receive this question quite a bit, so I wanted to address the issue. As someone who is new to the stock market, should they be starting out with options trading? In all actuality, this is the wrong question to be asking. Let me explain.

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Transcript:

Options for a beginner, wise?It's the wrong question to even be asking.Some may accuse this of being clickbait,but it's really not because this is actuallythe fact of the matter.I get this all the time.In fact let's quickly get to this question,and this is just, I kinda cherry-picked,but this question came via Twitter.Steen asks, "I was wondering as a beginner"could I start with options?"Now, in short, yes, you can, kind of.It depends really how you're definingbeginner though becauseanything, stocks, options, bonds, forex,it actually boils down to a key question.The question is kind of a slap in the face,but way too many people overlook this fact.Again, start, and yeah, we all start out as being new, butstocks, or in this case, options,let's go forex,cryptos, I can never spell that, crypto,and there's other ones.The question here is can I start,and in this case, as we've determined, with options?Can I start with options?Let me ask you this.Do you know how to answer this question?All this depends on this. (marker squeaking)Direction, what do I mean by direction?Do you know how to answer the direction,I think fill-in-the-blank is going to move up?I think fill-in-the-blank is going to go down.I think fill-in-the-blank is just gonna kindabounce around sideways for now.In other words, what directiondo you think the price is going to move?It could be price of a stock, price of an option,price of a currency pair,price of some sort of crypto currency,but no matter what you're trading,you need to be able to answer this very basic questionof what direction do I think it's going to move?It's not really (marker tapping)where you start off with in terms of what you're trading.It's starting off with can you answer that question?Because if you can't, then it doesn't matterwhat you're trading.You're just gonna lose your money.You're gonna be out there gamblingbecause if you're just randomly guessingon directions of prices, then that's no betterthan gambling, and while no tool out there is perfectin telling you what direction somethingwill move, there are definitely toolsthat will hedge things, put probabilities in your favor.For me personally, (clattering)I use a tool (marker tapping)of charts, otherwise known as tactical analysis.For this person, I would advise them,yeah, you can start with options,assuming you know how to figure outthe direction of a price.Charts are very, very helpful for that.What am I getting across here?No, a beginner should not start with any of these.A beginner needs to start with understandingthe tool of chartsbecause the tool of charts, like I said,circular logic here, is gonna help with direction,and that's what you need to be able to identify as a trader.Like I said, at the very beginning,it's not really the right question to be asking.Now, if this person said, "Hey Clay,"I understand charts really well,"I'm very proficient in them,"so now do you think I can move into options?"Yes, absolutely, but that's whya little gray area here 'cause I'm not sureif this person has that background or not.If you're literally brand new and wondering,"Well, should I start with stocks, options,"forex, or just crypto current--"first just figure out, "How am I gonna be,"I gotta get really good at putting the odds"and probabilities in my favor,"that I can actually determine what direction"such and such is going to move."Focus on charts first, and thenworry about what sort of vehicleyou're actually going to trade.If you're out there trading alone currently,and maybe are in the market, looking for a community to jointo assist you in your trading or to just help you,give you another set of eyeballs,then I do have a private trading community,where you can trade alongside meand other experienced traders.What you see popping up on the screen right nowis both an information link, so if you click onthe inner circle one, that is going to take youto the page where I explain all the detailsof what exactly come with the community,both the chat room and the news letter.Then the other image that has popped upis a behind-the-scenes tour, where you can see exactlywhat is going to be contained within the community.I take you through, like I said,a behind-the-scenes tour of everything.That way you'll know precisely what you are gettingwhen you join.Definitely check that stuff out if you are interestedand thinking about wanting to join a community,and let me know if you have any questions.

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