Trading Options – Understanding Risk (or how to lose $106,445 in one day)

The most important thing to understand in any trade – is the risk you are taking (how much can I lose?)  If you don’t understand the risks – you should not be trading – I don’t care if it is stocks, options, futures, forex, etc….

This brings us to this story which is all over the internet today:

• MarketWatch – Help! My short position got crushed, and now I owe E-Trade $106,445.56

The kicker is he does not have the money, and has started a GoFundMe campaign to help pay E-Trade!