Where are u checking ?

No but you must check the depth of the market in these contracts.
Sometimes the market is very small. Like one contract available at the
quoted price but other times the depth is vast like 400 contracts.

To get $4400 profit , Should person need to buy first 100 stocks by
paying $530 * 100 = $53,000 (One might NOT have these much money into
account) to sell them in $600 a stock or person can just sell without
even actually buying them.

newbie investor(Investing since November 06)

Sorry, I have been investing since November 2007...

You said you're relatively new at investing, <6mos.

I would strongly suggest you stay out of options, at least until you
understand them. I'm 23yrs old and have been in the market since I was
19.

I started out with 1 or 2 trades a month, locking in gains and
settling losses (once I hit 10% I was out...), I've progressed to
10-20 trades a month, and in the last 6 months have done a lot of
options trading in my Roth IRA account.

The Roth is a great vehicle for trading options, especially PUT/CALLS
because if you make an absolute killing (i.e. you picked a long shot
and it paid off.) you've just dumped a huge influx of cash into your
portfolio that will be tax free (unlike a std. brokerage.)

With all that tax free money, you can either.
a.) Buy more options. (good)
b.) Buy lots and lots of shares of undervalued stocks (and hedge with
PUTs) (BETTER)
c.) Figure out how much money you originally invested into your Roth,
and withdraw the original amount of money, and go buy your self
something nice...

for example C.) the max contribution for Roth IRAs was 4000 up until
2008 Tax Year, So say you maxed out your contribution for 2007 at
4000, and had already maxed out your 2008 contribution (you can start
your 2008 a few months early, IIRC.)

You can withdraw (at maximum) the original amount of your investment
(aka, your balance, less their gains and dividends, etc.). So, if you
invested 4,000 in 2007, and 5,000 for 2008, and then sold some options
that made you an enormous amount of money, say $10,000 profit...

It would be possible to withdraw $9,000 from your Roth without tax
penalty - As far as the IRS is concerned, it's your original $9,000
and all of your 'gains' are still in the sheltered account.

BTW, there are some options contracts I've purchased in the last month
that have nearly a 1000% profit, just in the last 15 days... yay for
call options in a bullish rally....

that's the way to do it - goog ap 500calls from 7.5k into 455k untaxed
in roth. at 23 i'll be set for retirement.

...thanks everyone. Wel lthe thing is I wanted to enjoy some of the $$
$ now, if I do make a profit, waiting until 59 + 1/2   is really a
long time. I wouldn't mind opening a Roth IRA once Im like in my late
30s-40s , but for now I actually would like to enjoy the  money while
I'm still young. Any thoughts on that?

Uncle Sam will profit the best from your gains... Especially if you
make a killing...

I would spread my money around in both Taxable (std brokerage) and
Roth (tax free) accounts.

I max out my Roth (have for the last 3 yrs) and have a XX,XXX amount
in my std brokerage.
If you're looking to make a killing in your roth account and then end
up needing the money, it is possible to withdraw the entire balance
from your roth without penalty if it is a qualifying expense. i.e.
down payment on a house, although personally, I wouldn't liquidate
10-20k from my roth, so I could make a down payment on a house...

if you get really confident in your strategies, and you feel bold,
invest in options and mirror your strategies in your taxable, and non
taxed accounts.

I don't know what you do for a living (as it's certainly not day-
trading), but I wouldn't quit my day job just because you made a few
hundred bucks a week trading options/stocks...

BIG MISTAKE. Most people don't save enough for retirement, and once
they start, they do it way too late. it's never too early to start
saving, I'm 23, and contribute 9% at work into my 401k and max out my
contributions to my roth every year without fail. By waiting until
you're 30-40 to start saving for retirement, you're short changing
yourself 100s of thousands of dollars in potential gains.

Here's a great site, which can just use a 401k as an example of
returns - http://www.bloomberg.com/invest/calculators/401k.html

say you're 23, make decent money (40k year) and contribute 4k a year,
at an average of 9% a year after 42yrs you'll have a little more than
2.2 million in your 'nest egg'

Say you delay your investment, and don't start saving until you're 30.
same income/contribution/returns after 35yrs is just short of 1.2
million.

say you're really late and don't start til 35! your nest egg will only
be 750,000....

So, time is on your side, don't make the mistake of waiting til you're
middle aged to start saving for retirement. With inflation, who knows
how far a million bucks will go...

Here's the Roth IRA calculator I was talking about,
http://www.bloomberg.com/invest/calculators/roth_ira.html

4k a year, retiring at 65
Starting at age - (amount invested) [value at retirement @ 9% Return]
23 - (168k) [$1,759,000]
30 - (140k) [$940,000]
35 - (120k) [$594,000]
40 - (100k) [$369,000]
45 - (80k)   [$223,000]
50+ I hear you can apply for AARP soon...

Prestoni, what online brokerage you use for your Roth IRA account and
option trading ? I have TD AMeritrade for my Std. Brokerage that I use
for stocks.

Also, if you put all your money into your Roth...how do you benefit
from your gains now ? I mean ,it would be nice to take out a few X,XXX
$  to enjoy it once in a while, if you DO make a killing.

Oh, and is it possible to lets say option trade in a std. account,
then if you get lucky, xfer money into the ROth account so it can
avoid the tax and just sit there / accumulate ?

Would it make sense to try and save up / make as much money as I can
in my std. brokerage account , then transfering some over to a Roth
IRA account . and use it there for accumulation / option trading ???
And just use the regular std. brokerage for stocks ?

I

While, I'm not a CFP (Certified Financial Planner), I have read plenty
of things about investing and saving, stocks/options/mutual funds etc.

I have TDAmeritrade for my main brokerage and my small Roth (only has
1 MuFund, CGMFX)
For my main Roth IRA, I have Zecco. It comes with 10 free trades per
calendar month, each additional 4.95
and the options contracts are cheap. $4.50 plus $.50 per contract with
no minimums.

While I'm not going to tell you how exactly much is in my brokerage,
I'll tell you my brokerage account has about 4x the amount of my Roth
IRAs, and my IRAs get maxed out early.

If you do make a killing in a tax sheltered account, you can only take
out the money equal to the initial deposits (without penalty, that
is...).

Stocks/Options cannot be directly transferred between account types
(i.e. standard brokerage to IRA) per IRS rules, stocks/options can
only be directly transferred between similar account types. for
example you have 2 different IRAs, one taxable, and one Roth, and wish
to move money from the taxable to the Roth.The caveat is (as I
understand it.) when it is transfered the current value is what counts
against your maximum deduction for the year.

If you make a killing in your taxable account, Uncle Sam is going to
get a BIG cut.

If the company you work for offers a 401k plan, invest at minimum the
amount that your company will match dollar for dollar, and in fact if
they match partially after that, go up to at least that amount. The
company where I work, matches 1:1 up to 3%, and 50c on the dollar for
everything up to 6%, which means every year the company gives me 4.5%
for FREE.

Max out your Roth IRA, for 2008, the maximum contribution is $5,000.
Anything extra you'd plan on investing, put in your taxable account.
If you absolutely absolutely needed the money you could get it from
your Roth (with a 10% penalty, on top of your normal tax rate.)

I have stocks in both my standard account and my IRA. The nice thing
about having an account with Zecco is that as long as your total
equity stays above 2500, you qualify for 10 free trades per month,
which means if you trade the stocks short term, your profit doesn't
get eaten up by commissions. It doesn't hurt you to buy only 1 share
of a company, or only 5 shares.. etc. because you're not paying out
the nose for commissions.

Say you bought a share of Google last week when it was 450, and this
week it went to 540. Well, you made $90 in one week, and could sell it
and claim your entire profit. Whereas if you were paying $10/trade
you'd have $20 in commissions eating into your nice 20% gains.

I plan to keep the Ameritrade (std) account (at least for the CGMFX
Roth), because I don't want to sell the shares I have in there, (I'd
take a bath in taxes, I don't have many long term trades in there.)
Plus I like the tools that TDAmeritrade offers that Zecco doesn't.

Prestoni, do you have any good recommended books I could read / that
you read to help you understand / get better at options ?

Also, do you know what does Option BP mean when you sign into
AMeritrade ?  It says ....  Stock BP XX,XXX  and Option BP XX,XXX    ,
what' is this BP all about ?

With that said, it looks like the possibility of someone making a
killing / huge return is quicker, but more riskier with Options. I
think if I am going to start playing around with options, I will open
an Roth IRA account with another brokerage, like you said, possiblty
Zecco, and trade options there, while keeping stocks on my TD
Ameritrade account. Nevertheless,, I have a long way to go, this is
only the beginning, :)

BP is buying power. Its the maximum value of stocks/options/mutual
funds that you can purchase.

If you have a margin account, BP is typically 2x what your non-
marginable funds value is, at least that's how TDAmeritrade does it...

Is it normal to not have " Stock BP " category ?
My account looks like this.

Cash balance
available funds for trading
available funds for withdrawal
option bp
acount value

Also I have a Stock + Option account only,  no margin account.

No you dont need to actually buy (you dont need to have 53k to make
profit) ... in the given example (i.e. when goog trades at 600 before
may 17) the GOOG May17 530 call would be trading for $70 (or more), so
you can simply sell the call option that you have. so purchase price =
2600 and selling price 7000 (profit = 4400).

but remember, if goog goes below 530 and stays there for next 1 month,
you lose entire 2600 by may17th (thats the risk)...

do some dummy trades in a practice account or something (not with real
money) to get some experience...

Yea I prracticed on a dummmy account for a few months before I got
into Real Stocks... Iguess now I should practice on a Dummy account
with Options...

if you put LEH or BSC at the right time, you get a 500x, which is much
bigger than GOOG's 20% boost.
WM same case.
a good hedge on LEH or BSC sometimes can give u 10000x profit. If you
bought those dollar option (just like lotteries) for just 100 then
after you wake up you recognize that you re sleeping on 1 million.
Market always has some gambling chances, but you have to admit those
brave players' actions.

To do what you just said, how much am I actually risking out of my
pocket, for such multipliers ?  Comission + what else ?

Could you please elaborate on

Could you please elaborate on "a good hedge on LEH or BSC sometimes
can give u 10000x profit"

Why does the april 19th 520 strike price go for 17,000%.  When you buy
a 520 call strike, you are allowed to buy that stock at $520.  Why did
the option value get so much higher when the shares went above 520?

I would like to know that also!!!

I think I know....its because originally the 530 calls options were
worth .10 cents each, and the highest on friday was @ 547.XX so I
think you need to subtract 547 - 530 = 17$   which is 17,000% increase
from .10  = your profit ? Correct me if im wrong..