The popularity of online options trading has exploded in recent years. The Internet has fueled a booming business of small investors putting money into the derivatives market. The benefit of an expanding range of financial products is greater profit potential for investors experienced in day trading; the downside is increased risk and a more complex trading environment. For the amateur investor ready to learn how to trade stock options, the derivatives market can be tempting, but also scary. This article will outline some advantages and disadvantages of the stock options market for the average investor. 5 Reasons to Trade Options Stock options trading is not for the faint of heart. Derivatives trading can lead to permanent loss of investors' capital, especially when that money is not secured by a hedge. This leads to the question: “Why would I want to enter such a volatile market?” The answer is simple: there is a lot of money to be made. Here are some other reasons.1. Faster Returns There is a lot of money to be made in a short amount of time. The return is fast compared to stocks.2. You don't need a bull market. Stock options are not as tied to market trends. You can still profit in a bear market.3. Insurance Through “hedging” (a type of stock option) you can insure significant amounts of your portfolio against catastrophic losses; hedging can significantly reduce risk during a bear market. For more information on hedging see the Options Trading Guide.4. LiquiditySince options are purchased at standard share (equity) percentages, you remain more "liquid" by retaining a greater amount of money to purchase stocks and stock options.5. Another weapon.St......middle of paper......helps you get your feet wet in derivatives trading. Sites like Optionsexpress.com and Investopedia.com allow you to learn how to trade stock options by creating a free dummy "money" account to use in a simulated options market. It is highly recommended that you practice buying and trading virtual stock options before risking money in real derivatives trading. Simulations are excellent resources for stock trading. They can show you where you are strong and what areas you need to improve in to have the best chance of winning the investing game. Online References https://www.thinkorswim.com/tos/client/index.jsp https://wwws.tdameritradeconferences .com/workshops/default.asphttp://www.onlineoption.com/http://www.optionsxpress .com/http://www.clarkfinancial.com/option-trading-tips.htmlhttp://investopedia.comhttp //simulator.investopedia.com