How to Trade Options in WeBull
Although the word on the street is that options trading is risky, it can actually carry less risk than trading stocks or bonds, provided you use the right strategy. Options can have numerous advantages if you know how to trade them properly.
Learning how to trade options in Webull can come in handy. In this article, we’ll discuss the process of trading options, the advantages, and a number of proven strategies.
How to Trade Options in Webull on a PC
- Go to Webull and open an account – the first step is opening and funding your account. Open your browser and visit Webull’s website. Opening an account is simple and there isn’t a minimum deposit. Just enter your email address, where you’ll receive a verification code and a password. When you’ve successfully opened your account, you’ll be redirected to a page where you can get information about insurance and investor protection. You can now download the desktop app or keep using your browser.
- Log in to the app and validate your identity – use your email address and password to log in. After that, tap “Unlock trading” on the right side. Now, validate your identity by uploading photos of your driver’s license. Alternatively, you can use your Individual Tax Identification Number (ITIN), U.S. passport, or Social Security Number (SSN). U.S. residents who are non-citizen must have a valid E1, E2, E3, F1, H1B, H3, TN1, O1, or L1 visa.
- Send an approval request – trading options can be a risky endeavor. That’s why Webull requires you to complete an application to see if you qualify. It consists of several questions regarding your investment experience and financial profile. You’ll receive a reply in 24 hours.
- When you’re approved, tap the stocks icon on the left side. It’s the second icon from the top.
- Open any stock and tap the “Options” tab from the top menu. You’ll be redirected to the options chain for that stock.
- Start trading! Beginners might want to take an introductory options trading course first.
How to Trade Options in Webull on the iPhone App
- Go to the App Store and download the Webull app.
- Create an account using your email address and a password. You’ll receive a verification code via email. Once you’ve successfully opened your account, you’ll be redirected to a page containing information about insurance and investor protection.
- Tap “Unlock trading.” For unlocking, you’ll need to validate your identity by submitting photos of both sides of your driver’s license. You can also use your ITIN, passport, or SSN. If you’re a non-citizen living in the U.S., you can open and fund your account if you’re on an E1, E2, E3, F1, H1B, H3, TN1, O1, or L1 visa.
- Apply for options trading. Like most brokers, Webull requires you to complete an application to ensure you qualify. This involves answering questions related to your investment experience and financial profile. You’ll receive a response within 24 hours.
- Go to the stocks details page and tap “Options” in the bottom menu.
- Select the issue that interests you.
How to Trade Options in Webull on the Android App
- Go to the Play Store and download the Webull app.
- Open an account using your email address and a password. Before that, you’ll have to verify your email address. Once you’ve successfully opened your account, you’ll be redirected to a page where you can read more about insurance and investor protection.
- Tap “Unlock trading.” You’ll need to validate your identity by uploading photos of a valid driver’s license (both sides). They’ll also accept your ITIN, U.S. passport, or Social Security card. Non-citizens residing in America are eligible if they’re on an E1, E2, E3, F1, H1B, H3, TN1, O1, or L1 visa.
- Request approval for options trading. Webull requires you to send an application to ensure you qualify for trading options, essentially several questions related to your financial profile and investment experience. You’ll receive an answer within 24 hours.
- Go to the stocks details page and tap “Options” in the bottom menu.
- Choose the relevant security. If you don’t know what you’re doing, you can always take an options trading course.
Be Careful When Trading Options
Options trading sounds tempting and sophisticated. However, it is also more complicated. Consider the following before taking the plunge:
- Experience – there are a lot of pros in options trading. Do you have what it takes?
- Risk – you should have an objective view of your risk appetite.
- Platform – Before you commit, check the platform’s transparency, price, and fee structure. For one, Webull is friendly to beginners owing to its simple interface. In addition, Webull offers educational material.
What Option Strategies Can I Use in Webull?
Webull offers a range of strategies. The choice depends on your investment goals. Here’s an overview:
This is the most basic strategy, where you either buy or sell a single options contract. This strategy is also called single.
This strategy involves writing a call or put to cover your stock position (long or short).
Use this strategy to simultaneously buy and sell numerous options of the same security, type, and expiration date at different strike prices.
The strategy is related to low or high stock price volatility. It combines three calls or three puts in a 1-2-1 ratio. In essence, you’ll be trading at a fixed amount of potential loss for limited profit.
This is a non-directional strategy based on high or low volatility. In this case, the losses are limited, and so are the gains. You can go long or short, where the long condor is profitable when stock prices change significantly while the short condor banks on stable prices. Both the short and long condor use one call or one put at a time.
This strategy protects you against large losses but again, the potential gains are also limited. If you believe that stock prices will change over a longer period, this could be the right strategy to use.
The straddle involves simultaneous buying or selling one put and one call with the same strike price and expiration date. Again, you can go long or short (see Condor above).
In this case, the investor has both a call and a put of the same security and expiration dates but different strike prices. Once again, you can go long or short.
This strategy combines two calls or two puts with three strike prices of the same expiration date. There’s a limit on the maximum loss and profit.
The iron condor uses two calls or two puts combined with four strike prices of the same expiration date. This is another strategy where the maximum loss and profit are limited.
What Are the Benefits of Using Webull to Trade Options?
- No commissions
- No contract fees
- Flexibility – Webull allows you to adjust for any market conditions and take appropriate actions.
- Leverage – you can trade on margin.
- Hedging – many of the options trading strategies outlined above involve hedging.
- Income generation – Depending on your knowledge, experience, and the market, you can generate significant income.
Enjoy the Trades and Accept the Risks
Webull is an excellent platform for trading options for its simple interface, no-fee trading, and flexibility. We hope this article helped you to learn how to trade options in Webull.
Have you ever traded options? Did you use Webull? Tell us in the comments section below.