August 7, 2018 ...
You need to know dividends. Also understand that many day traders use the dividend to buy a stock that pays a higher dividend for a very short period of time. Thus a stock can actually go up and down (strangely) and even create a gap simply because of an upcoming dividend payout announcement. People who buy the stock simply for the dividend payout buy ahead of the payout and sell the dividend when it is declared. (learn more here: [
www.investopedia.com])
Knowing this as an option trader, i.e when a dividend is to be paid out and how your stock choice moves around a dividend; can lead to making money on an options trade. Just like knowing earnings announcements aids a trader of options so does dividend payouts.
This is why it is important to KNOW your stocks and have a platform that will tell you when a dividend payout is about to happen.
Trade smarter not harder....
Today (@ 9:51) I bought a PUT on AAPL using that information. NOT FOR A LONG TIME BTW!! 10 contracts 210 strike @ $3.75. I sold right before 10:15 @$4.45.
Learn dividends as well as earnings and become a better trader. (For the over-night holders) August 8, 2018 On the open AAPL down that means that 210 strike had I held over night can now be sold for $5.35 @ 9:49.
Edited 2 time(s). Last edit at 08/08/2018 08:50AM by Darcy3.
