Options lesson for beginners: opening & closing trades (video)

Watch the free video here: VIDEO.

When you're trading options (puts and calls), your "opening" trade can be either a "sell" transaction or a "buy" transaction.  That's right, you can SELL options first, get paid up front, and then buy back the options later.  Thus, you sell high and hopefully, buy back low.  The difference between your initial "sell" price and your subsequent "buy back" price is your profit.

Summary:

If your opening trade is a "sell," then just buy back the option to close your "short" position.

If your opening trade is a "buy," then just sell the option to close your "long" position.

For more details, check out THIS SHORT VIDEO.