Futures are an obligation.

An example: Currently cement is selling at HK$692 per tonne. You think that due to seasonal changes, there is a likelihood of prices going up after 3 months. You are constructing a house and after 3 months you’ll need 1, 000 tonnes of cement. You want to have some price guarantee. As a buyer, you enter into a contract with a seller to purchase cement at $695 per tonne in future at $3 higher price.

After three months, the price of cement could be $715 or $690 per tonne. You never know.

If the market price after three months rises to $ 710, you have saved $15 per tonne or $15,000 overall. Price agreed was $695.

If the market price after three months drops to $690, you still have to buy at $695. You stand to lose $5 per tonne. Total loss is $5,000.

As you can see, Futures is a linear contract. For every $1 price movement of cement, you make or lose $1 per unit.

Options are a right, not an obligation

As a buyer of the options, you agree that after contracted time, you will honour the deal. Only if it favours you. And for this privilege, you pay a small premium.

Real-life example of Call option use

In the same example of cement deal, if the buyer pays $3 as a non-refundable token fee to the supplier to deliver the cement at the agreed price of $695 and the vendor agrees to the condition that the buyer will keep the option of whether to buy or not cement in future.

If the transaction does not go through, the vendor forfeits the token fee.

Your cost goes up to $698 because you paid the seller a fee of $3.

If after three months, the price increases to $710, you stand to gain $12 per tonne based on your cost of $698. You will surely exercise the option of buying the cement since it benefits you.

Instead of the price rising, if it has dropped to $690, you will not exercise your right to get cement at $695. You will be better off foregoing $3 premium as a loss and buy the cement from the market at a price of $690, and still save $2.

This is how a Call option works .

Real-life example of put option use

How does a Put option works? You bought a health insurance policy to keep your costs down. In case of an illness, you don’t want to end up paying the entire hospital bill. On receipt of a premium from you, the insurance company has agreed to cover any hospital bill exceeding HK$ 10,000.

In case of minor illness or incurring a medical bill less than $ 10,000, you will lose $1,000 premium in that year. But in case of a major surgical operation with a hospital bill for $50,000, you pay $10,000 and the insurance company pays the rest $40,000 as part of the insurance policy. You gained $39,000 after having paid $1,000 as the cost of the premium.

In effect, your investment was $11, 000 while the return of gains is $39,000.

A buyer can only lose the premium, but make a lot of money. Thus, options are non-linear instruments.

If the insurance company has collected premiums from 2,000 people and only 1 person has lodged claimed, the insurance company still makes money. The insurance company has done its homework and has statistics on an average rate of people requiring costly hospital care. It is, therefore, willing to take the risk.

Home-based Business

You do not need any prior experience in Financial Trading and Portfolio Management to conduct this business. All you require is a basic level of common sense and arithmetic ability.

The business does not require sourcing of sellers. As a buyer you have to pay money upfront, but you don't have to worry about payment defaults by sellers or enter into a contract.

I will teach you everything you need to know from my hands-on experience. It does not matter whether you are a beginner or an experienced financial trader.

Through this website, you will be provided free learning material - practically everything that is needed to start this business in a couple of days. And in a language you understand.

Why Options?

Options can be traded both for speculation and non-speculation purpose.

Selling largely involves using options without speculating. Options trading does not involve buying or selling a currency or any financial asset. A buyer is paying full payment (option premium) upfront to a seller asking for a guarantee to deliver the market price value of the asset (not the asset itself) at the end of a certain period in future and at the price agreed presently.

Options can be risky, both for speculators and non-speculators, but they don’t have to be. Options can be less risky or more risky, depending on your risk tolerance.

Do you have a Growth Mindset?

This business model will suit people who feel comfortable in taking risks.

This enterprise involves the use of:

• leveraging and intelligent use of capital to generate better returns;
• understanding market volatility and liquidity.

Most of us are aware that in today's digital world, income can be generated without anyone having to set up own bricks-and-mortar operation.

For instance, in the case of consumer product business, Amazon and some B2B marketplaces are a boon for entrepreneurs who conduct business from their homes.

For financial traders, CME Group provides diverse derivatives marketplace, made up of four exchanges, Chicago Mercantile Exchange (CME), CBOT, NYMEX and COMEX. Those who have money can conduct both speculative and non-speculative business at these marketplaces.

Speculative trading needs an investor mindset. It needs a skillset that requires a speculator to basically forecast the direction of the financial market and aim for high returns.

Non-speculative trading, typically, is a form of financial insurance. It is as useful as property and health insurance. It needs a skillset that involves managing risks and generating regular income and be content with limited returns.

At this website, the focus is on speculative use of Currency Futures options.

The main business objective is to generate higher returns than the normal. Of course, there is no free lunch.

Why Currency Options?

The learning curve is short. A maximum of 38 hours is required to understand just one financial instrument and conduct required self-directed execution operations. You can acquire information on all the skills that you need from this website alone. You don't have to attend any theoretical course. Options educators offer courses ranging from Hk$150,000 to HK$400,000. You are getting it free.

Without self-practising or without supervision, you should not attempt this business venture.

Anyone can start speculation business using options with as little as US$10,000 as capital.

Leverage is provided by a regulated Exchange , so your returns can be exponential. You can really put your capital to work harder. You don't have to approach any bank for an overdraft or credit facilities to get leverage.

Let us term it as a Financial Risk business that requires:

• No business or professional licence
• No office
• No staff to deal with customers and payouts
• No need for customer (seller) acquisition
• No laptop or desktop computer. Smart-phone will be used.

What is required is an understanding of a few concepts.

• Pricing: How it is influenced by market forces of demand and supply
• Minimising or transferring unwanted risk

Do I need to have any knowledge of analyzing charts, indicators, trends or market sentiment?

Yes, you are required to understand reading price charts, analyse fundamental events or spare time to learn technical analysis. Just need basic knowledge of how to do it. No need to acquire Technical Analysis skills.

How much investment is required?

Like any money-intensive business venture, It is risky. Returns will match the degree of risk you want to take.

The minimum preferable capital is US$10,000. Your income goals will determine the total capital required. It should roughly be in the multiples of $5,000 beyond $10,000.

In order to give you confidence that you can execute transactions online, I will conduct live trading at a mini boot camp as well as post my own trading records on this website on a regular basis on a complimentary basis. By the end of three months of observation, you will be able to understand how this business is done and how much income is generated. You will be in a position to set your own money income goals.

Like any other business, there is, of course, no guarantee that you will make a profit from each and every transaction. You could even lose money.

Who sources sellers for you?

Currency Options (OTC) are commonly used by private big investors and large businesses to hedge open or future deals either with banks or institutions in a bilateral contract arrangement.

Very few retail brokers provide an online platform for OTC options.

OTC currency options are expensive and not worth the try for a regular income unless you have deep pockets.

A regulated Futures Exchange like Chicago Mercantile Exchange provides a 23-hour (HK time 5 am - 4 am Monday to Friday) online platform, called Globex, to attract buyers and sellers.

The CME currency futures options market is very liquid, the costs of buying and selling (spread) are at least 80% cheaper than the banks or online broker's platforms offering OTC options.

We will be using CME platform for the business and dealing with an authorised broker for CME. A number of brokers offer connection with CME platform.

How much time do I need to get trained as a professional?

Training can be done in two ways depending on whether you are a beginner or intermediate learner.

Learn, do and earn together

If your mindset is willing to accept this kind of training process, then you can look for a mentor.

You can acquire skills by trial and error methods while having a mentor beside you.

If you have some experience in spot currency market trading, then the learning curve will be quite short. Not more than 8 hours to understand the transaction execution process.

Learn first and do later

If you are a self-motivated person and want to learn by trial and error on your own, you can go through a simulated trading environment by doing some dummy transactions before launching the live business.

An intermediate learner who has done any kind of financial trading will need a couple of hours to understand the whole self-directed transactions process.

A beginner might take 3 days to start executing transactions on a paper (dummy) trading account.

It is really not necessary to spend money on expensive courses. Just follow this website and try not to get overwhelmed by the information available on various websites. Information overload will impair your learning and decision-making process.

How do I train myself to be a self-directed trader?

Like any business, a new venture requires dedication and time. It should be undertaken in stages. You may fail frequently as part of a natural growth process.

For training, you would need:

1. A glossary of essential terms, preferably restricted to 20 in number. Technical terms should be learned in layman's language. See Glossary Page.

2. An understanding of the concepts of:

• How fx market functions
• Forecasting or predicting probabilities of your trades going in favoured direction
• Profit, loss and expenses
• Taking Risks and managing them

3. to practise the execution of transactions on a mobile phone or tablet trading platform. You really don't have to be tech-savvy to do this job.

4. to understand how the Chicago Mercantile Exchange (CME) works like an Amazon marketplace for the derivatives.

5. Discipline to acquire essential knowledge and skills without overloading yourself with unnecessary information. A beginner should be prepared to spend not more than 8 hours on understanding how financial markets work in general and the Currency market in particular.

6. Must have self-awareness about your psychology of money and the role played by fear, risk, loss, and unreal expectations bordering on greed in influencing business decisions. As long as you treat the business as financial speculation, you will do fine.

What are Currency options?

Option buyers in general pay a premium to the sellers to hedge their assets. How high the premium will depend on how volatile the currency is and how long will the protection be available.

In effect, sellers of Options provide a type of insurance against price changes in underlying assets such as currencies, stocks, bonds, commodities, etc.

Buyers pay premiums depending on the anticipated volatility of the market. Many a time, even if the market moves in the favour of a buyer, the trader may only break-even or lose money because of higher premium paid to seek protection against adverse price movement.

In short, as a speculator, when anyone buys options on an asset (currency futures) , the asset has to move in the right direction and move far enough in time for the buyer to make any money.

Choosing the premiums requires experience and an assessment of the market.

Currency option contracts are traded every week, month and quarter.

You can choose the currency pairs you want to trade.

Basic analysis is to be done as to whether you are buying any undervalued call options or buying overpriced put options. Sellers will aim at trading underpriced puts and overpriced calls.