Why Options?

As an investor new to options trading, you likely have many questions on your mind about this alternative. You may have heard stories from friends, spoken to your broker, or are just intrigued to learn more.

Our goal is to provide you solid, reliable and professional information about options trading in a straightforward manner so you can expand your understanding of this powerful tool. With understanding comes confidence. With confidence comes the power to positively affect the overall returns in your investment portfolio.

Why options? For three important reasons:

• 1.  Limited dollar risk and limited dollar exposure

  As an option buyer, you benefit from being able to control the movement in a stock for just a fraction of the cost of purchasing that stock. Plus, you can never lose more than this modest dollar amount. As a result, you can keep the bulk of your investment dollars in the safety of cash where it is immune to the wild and often scary swings in the market.

• 2.  Leverage

  You can achieve percentage gains from your successful options investments that are 5, 10, and even 20 times the gains achieved by stock or mutual fund investors.

• 3.  Profit in Bull and Bear Markets Alike

  This is certainly a claim that none of the traditional mutual fund families can make, and it is at the heart of why experienced options traders have profited in the volatile recent markets. By buying put options, you can achieve leveraged profits with limited dollar risk when a stock declines in price. Of course, leveraged gains can be achieved on bull moves by buying call options, but bull market profits comprise only half of the total options profit picture.

Your curiosity about options is matched by many others. In 2005, more than 1.5 billion option contracts were traded, reflecting a growth rate of more than 25% per year for the past several years.

In 1998 the industry recognized the outstanding achievement of Dr. Myron Scholes, who received the coveted Nobel Prize in Economics for his work in developing the Black-Scholes model for valuing derivatives and stock options.

We understand the need for knowledge and investor confidence before engaging in an options trading program. To this end, we have dedicated a major section of our award winning web site to this topic, found in our Getting Started section.

This important section allows us to apply our nearly 20 plus years of options expertise to helping new options traders better understand this investment alternative. Over the years we have helped tens of thousands of investors become successful, confident options traders.

Bernie Schaeffer's international reputation as an options expert is recognized by the most respected industry players such as The Wall Street Journal, Barron's, CNBC, CNNfn, Bloomberg, The New York Times, Fortune, Forbes, CBSMarketwatch.com and many others. His revolutionary Expectational Analysis^® represents a major technical breakthrough recognized by his "Best of the Best" award from the Market Technician's Association. Read more about Bernie Schaeffer.

Overall, we welcome you, encourage you to explore our award winning web site, and hope you will use our 15-minute question and comment interactive tool as often as you'd like.

Whether you are a customer, investor, partner or industry professional, Schaeffer's Investment Research believes that over 20 years of options excellence justifies your interest and attention. Schaeffer's Investment Research will work hard to maintain our record of performance, innovation and leadership.