SteadyOptions is an options trading forum where you can find solutions from top options traders. Join Us!

We’ve all been there… researching options strategies and unable to find the answers we’re looking for. SteadyOptions has your solution.

The Lessons in Business We Can Apply to Investing


While running a business and investing are two very different things, there are a number of parallels that apply to both. If you are looking to start trading and you are running a business, or vice-versa, there are some lessons that you can carry from one to the other.

 

The More Knowledge, the Better

The best thing anybody can do, whether they are starting a business or investing in stocks, is to have as much information at their fingertips. While it's not a given that being well-read will guarantee massive success, the fact is that if you want to be serious about running a business or get deep into investing, you will need to seek out additional knowledge. You need to understand things like what an investment memorandum is and how you can engage in disaster planning if you want to survive and thrive.

 

 

When it comes to running a business you've always got to find ways to be ahead of the curve and the same applies to investing. There is always going to be a new toy or approach that will help you to differentiate yourself, which will hopefully reap the rewards. 

 

When it comes to business, it's important to be as diverse as humanly possible. And whether this means having a variety of merchant accounts, payment methods, or engaging with customers on completely different levels, this approach will always benefit because you are spreading yourself far and wide. For example, you can see this merchant account available here and how it helps businesses diversify the payment methods because they can meet the customer on their terms. 

 

In stocks, you can diversify your investments in order to cover certain basics. Diversifying your portfolio is one of the best approaches to covering your bases. And the one sure-fire way to achieve this? Knowledge. 
 

Failure Is a Given and We Must Embrace It

Whenever we look to get invested in stocks and shares, we have to remember that not every stock we will invest in is going to be a success. You will make investments that will invariably lose money. 

 

When you make these investments in a business the same will apply. There will be periods of time where you will lose money but also make money. But losing money is a very beneficial lesson, no matter how difficult it is at the time. 

 

But the lesson is to take what you've learned and not make those mistakes again. When you are investing in stocks, learning those big mistakes that so many beginner investors make becomes a solid lesson about investing but also the emotion of investing. 

 

Many people become greedy and think that they will be able to ride the wave for as long as possible. Unfortunately, many entrepreneurs think the same way. But luck runs out, and things take a nosedive.

 

Logic and Emotions Are Two Different Things

Many of us have learned the lessons from emotional trading. If you invest in a company because you have an emotional connection to it, this is not recommended. And the same applies in the business world. 

 

If you hold onto something because of an emotional attachment, this is going to seriously hinder growth. Many entrepreneurs believe that they need to conduct business in a certain way because they are following a gut feeling. 

 

While there is something to be said for trusting your instincts, you also need to remember that you approach it with a logical mindset. When you are investing, the fact is that the market doesn't care about your emotions, and it doesn't have feelings of its own. It will fluctuate as much as the wind changes direction. 

 

This is why it's so important that, whether you are starting a business or investing in stocks, you've got to separate your logic and your emotions because the internal battle between the two can have a serious impact on future successes.
 

Focus on the Long-Term

Warren Buffett has attributed his success to sticking to his guns. When you're looking to invest, you will need to find something where you can stick with them for the long haul. This will also apply to businesses. 

 

Many people think that they've got to jump on the latest trends, whereas in fact, settling for the long haul and riding through the difficult times is more likely to incur a reward in the end. 

 

These are big lessons we can all learn from whether we are running a business or we are looking to invest. There are so many different carryovers between the two that sometimes it really pays to have a business-like mindset in investing, while also having an investor’s mindset in business.

 

This is a contributed post.

What Is SteadyOptions?

Full Trading Plan

Complete Portfolio Approach

Real-time trade sharing: entry, exit, and adjustments

Diversified Options Strategies

Exclusive Community Forum

Steady And Consistent Gains

High Quality Education

Risk Management, Portfolio Size

Performance based on real fills

Subscribe to SteadyOptions now and experience the full power of options trading!
Subscribe

Non-directional Options Strategies

10-15 trade Ideas Per Month

Targets 5-7% Monthly Net Return

Visit our Education Center

Recent Articles

Articles

  • SPX Options vs. SPY Options: Which Should I Trade?

    Trading options on the S&P 500 is a popular way to make money on the index. There are several ways traders use this index, but two of the most popular are to trade options on SPX or SPY. One key difference between the two is that SPX options are based on the index, while SPY options are based on an exchange-traded fund (ETF) that tracks the index.

    By Mark Wolfinger,

    • 0 comments
    • 453 views
  • Yes, We Are Playing Not to Lose!

    There are many trading quotes from different traders/investors, but this one is one of my favorites: “In trading/investing it's not about how much you make, but how much you don't lose" - Bernard Baruch. At SteadyOptions, this has been one of our major goals in the last 12 years.

    By Kim,

    • 0 comments
    • 904 views
  • The Impact of Implied Volatility (IV) on Popular Options Trades

    You’ll often read that a given option trade is either vega positive (meaning that IV rising will help it and IV falling will hurt it) or vega negative (meaning IV falling will help and IV rising will hurt).   However, in fact many popular options spreads can be either vega positive or vega negative depending where where the stock price is relative to the spread strikes.  

    By Yowster,

    • 0 comments
    • 806 views
  • Please Follow Me Inside The Insiders

    The greatest joy in investing in options is when you are right on direction. It’s really hard to beat any return that is based on a correct options bet on the direction of a stock, which is why we spend much of our time poring over charts, historical analysis, Elliot waves, RSI and what not.

    By TrustyJules,

    • 0 comments
    • 480 views
  • Trading Earnings With Ratio Spread

    A 1x2 ratio spread with call options is created by selling one lower-strike call and buying two higher-strike calls. This strategy can be established for either a net credit or for a net debit, depending on the time to expiration, the percentage distance between the strike prices and the level of volatility.

    By TrustyJules,

    • 0 comments
    • 1,491 views
  • SteadyOptions 2023 - Year In Review

    2023 marks our 12th year as a public trading service. We closed 192 winners out of 282 trades (68.1% winning ratio). Our model portfolio produced 112.2% compounded gain on the whole account based on 10% allocation per trade. We had only one losing month and one essentially breakeven in 2023. 

    By Kim,

    • 0 comments
    • 5,903 views
  • Call And Put Backspreads Options Strategies

    A backspread is very bullish or very bearish strategy used to trade direction; ie a trader is betting that a stock will move quickly in one direction. Call Backspreads are used for trading up moves; put backspreads for down moves.

    By Chris Young,

    • 0 comments
    • 9,500 views
  • Long Put Option Strategy

    A long put option strategy is the purchase of a put option in the expectation of the underlying stock falling. It is Delta negative, Vega positive and Theta negative strategy. A long put is a single-leg, risk-defined, bearish options strategy. Buying a put option is a levered alternative to selling shares of stock short.

    By Chris Young,

    • 0 comments
    • 11,148 views
  • Long Call Option Strategy

    A long call option strategy is the purchase of a call option in the expectation of the underlying stock rising. It is Delta positive, Vega positive and Theta negative strategy. A long call is a single-leg, risk-defined, bullish options strategy. Buying a call option is a levered alternative to buying shares of stock.

    By Chris Young,

    • 0 comments
    • 11,530 views
  • What Is Delta Hedging?

    Delta hedging is an investing strategy that combines the purchase or sale of an option as well as an offsetting transaction in the underlying asset to reduce the risk of a directional move in the price of the option. When a position is delta-neutral, it will not rise or fall in value when the value of the underlying asset stays within certain bounds. 

    By Kim,

    • 0 comments
    • 9,673 views

  Report Article

We want to hear from you!


There are no comments to display.



Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account. It's easy and free!


Register a new account

Sign in

Already have an account? Sign in here.


Sign In Now

Options Trading Blogs