I often think about other people who trade options just as much as I really do for hours on end. I wonder should they utilize the best discount brokers that area available and most importantly, just how can they keep records of their trade?
The purpose of documentation within the complex profession of trading stocks in my view is definitely about it is essential there is. Just how do you determine you’re successful in trading options should you don’t know your profits and losses per stock, per trade type, per day, monthly to get a whole year? In my opinion the answer is definitely a mixture of 3 methods. The 1st approach to course will be to utilize a spreadsheet to hold a current total of most stocks I own. I keep another spreadsheet to record all my expenses for each and every month, and also this is important to know the grand total of all the income sources and expenses including trading fees.
The most significant tool I prefer for many my stock and option trading is Microsoft Access. Utilizing the Access database is the perfect tool for recording each stock or option trade. For options I have got 39dexupky column that represents the quantity of contracts for every single option trade and for options one contract represents 100 shares of stock. Basically If I buy and option contract then this contract number would be negative of course, if I sell then your contract number would be positive. Other columns inside the table can be for the price tag on the choice as well as the trade fee, to calculate the total for any option trade can be (100*Price*Contract) – Trade fee. Using SQL (Structured Query Language) has allowed me throughout the years to show extremely important statistics and reports to let me know how I am doing for almost any stock or option trade type or strategy and summarizing performance by stock, option, month, day or year has become super easy to complete.
The main point is how will you actually know how you are carrying out should you don’t keep records? You can find a stock put to you and after that sell it off at loss, but understand that overall due to option premium you received for selling the PUT that truly you produced a profit on that trade overall. Without keeping records, you would probably never learn how you undoubtedly did for almost any specific complex option trade.