Can you give me a real life scenerio from your own trading?

*Written by Stephen Cooper on 3/23/00.

An excellent real life example of the power of leveraging the stock market through the use of options on stocks was made clear to me today. About a year ago I bought some LEAPS on Cisco Systems. LEAPS are simple options with a longer time frame to expiration, up to two years. 

At the time I brought two contracts. Since that time Cisco has made two 2 for splits. My previous two contracts have now grown to eight contracts due to these splits. For an explanation of stock splits, take a look at Investopedia's definition HERE. 

In conjunction with this, the underlying Cisco stock has appreciated nicely. My options are now well "In-The-Money". That means that their strike price is below the current price of the underlying stock. This adds value to such an option. 

Currently when Cisco shares raise $1, my option premium also increases by $1. Think what this means. It is staggering!  

Every time Cisco goes up $1, I make $800! Why? Because each single contract controls 100 shares of the underlying stock. 

Today Cisco stock went up $5 1/2. So I made $4,400 today alone on this one position. 

Yesterday Cisco went up about $6, so I made $4,800 yesterday! 

 Consider then, the awesome power of prudent use of options on stocks! And that my friend is what I am here to teach you.

To learn more about the leveraging power of options, visit www.OnlineOption.com!