In “I want to start [tag]investing[/tag], are stocks best for me” article I mentioned that I wish to learn and start [tag]trading options[/tag] as well. However I have never traded options and I have no idea how it works, how to trade them, and [tag]evaluate options[/tag] to make the [tag]trading[/tag] successful. To learn options I have bought some books and I have opened a [tag]virtual account[/tag].

Since I had some experience with [tag]stocks trading[/tag]; I knew how to evaluate stocks on some level, execute orders and overall how to trade them I could afford to start with a small account to practice the selected strategy. In [tag]stock options trading[/tag] I have no clue how it works, how to do it. This is why I have started by opening a virtual account, so I should be able to try all basics and mechanics in trading first. After I get familiar with basics I will employ some small money and start trading with small money in real trading.
I have opened the account some time ago and just tried something. Here is the result:

Date	Action	Qty	Symbol	Description	Price	Commission	Net Amount
12/03/08	Buy To Cover	100	BABY	NATUS MEDICAL INC	$12.36	$14.95	-$1,250.95
10/17/08	Sell To Close	1	.QBUVE	BABY OCT 2008 25 P			$0.00
10/17/08	Sell To Close	1	.QBUJE	BABY OCT 2008 25 C			$0.00
10/17/08	Sell	100	BABY	NATUS MEDICAL	$25.00	$14.95	$2,485.05
09/26/08	Buy To Open	1	.QBUJE	BABY OCT 25 Call	$0.25	$14.95	-$39.95
09/26/08	Buy To Open	1	.QBUVE	BABY OCT 25 Put	$4.00	$14.95	-$414.95

I have made $779.20 so far (virtual). However I have no idea how I did it, well I know how it happened by looking at those trades, but I don’t know why I have selected the options as I did and which one was correct, wrong, or so.
My next task is to learn options trading. I will use the virtual account and I will post my results and possible strategies.
I started my virtual trading with $5,000 and here is an overview of the account. I will post this overview the same way I do with stocks.

Options Picks 12/01 – 12/05

No [tag]new picks[/tag].

No new picks.

Existing holdings:

100% CASH

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Contribution this week: $0

Starting account value = $5,000.00

Account value = $5,779.20 (without margin)

Buying power = $11,558.40

[tag]Portfolio Gain/loss[/tag] this week = 15.58%

[tag]Portfolio[/tag] Gain/Loss for DECEMBER 2008 = 15.58%

Portfolio Gain/loss since inception = 15.58%

[tag]Annual Return[/tag] (CAGR): 15.58%

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