Options trading can offer exciting opportunities for high returns, but it can also be risky for beginners. If you’re looking to get started with options, it’s essential to choose stocks that have sufficient liquidity, strong fundamentals, and clear trends that make options trading feasible. Below, we’ll explore five stocks that are well-suited for options trading, with a mix of high volatility, consistent movement, and options volume. These picks provide an ideal starting point for traders wanting to learn and experiment with options strategies.
Investing Report: Beginner-Friendly Options Picks for 2025
Introduction
Options trading can offer exciting opportunities for high returns, but it can also be risky for beginners. If you’re looking to get started with options, it’s essential to choose stocks that have sufficient liquidity, strong fundamentals, and clear trends that make options trading feasible. Below, we’ll explore five stocks that are well-suited for options trading, with a mix of high volatility, consistent movement, and options volume. These picks provide an ideal starting point for traders wanting to learn and experiment with options strategies.
1. Apple Inc. (AAPL)
- Options Volume: High
- Volatility: Moderate
Why It’s a Top Pick for Options
Apple is one of the most actively traded stocks on the market and one of the most popular picks for options traders. The stock exhibits strong liquidity in its options market, meaning there are plenty of contracts available for trading with tight bid-ask spreads. Apple’s price movements are often driven by product launches, earnings reports, and news related to its ecosystem, making it an excellent choice for both call and put options. The company’s strong fundamentals and large market capitalization provide stability for traders, while its price movement can offer profitable opportunities.
2. Tesla Inc. (TSLA)
- Options Volume: Very High
- Volatility: High
Why It’s a Top Pick for Options
Tesla is known for its high volatility, which can create large price swings and lucrative options trades. If you’re looking for a stock with the potential for quick gains (or losses), Tesla fits the bill. The company’s stock is highly responsive to news related to electric vehicles, autonomous driving technology, and production updates. Options on Tesla can provide ample opportunities for those willing to take on higher risk in exchange for potential reward. Its high options volume ensures good liquidity, which is critical for executing trades efficiently.
3. Microsoft Corporation (MSFT)
- Options Volume: High
- Volatility: Low to Moderate
Why It’s a Top Pick for Options
Microsoft offers a solid foundation for options traders who prefer more predictable price movements. With its established position in the tech sector and consistent growth, Microsoft’s stock tends to have less volatility compared to companies like Tesla. This makes MSFT an excellent choice for traders who want to use strategies such as covered calls or cash-secured puts. Its regular earnings releases and product launches, like new software or cloud offerings, provide opportunities for short-term options strategies. Furthermore, Microsoft’s stock liquidity ensures you can enter and exit positions efficiently.
4. Advanced Micro Devices (AMD)
- Options Volume: High
- Volatility: Moderate to High
Why It’s a Top Pick for Options
AMD has become a strong player in the semiconductor industry, with a reputation for delivering cutting-edge technology in CPUs and GPUs. The company’s stock is more volatile than established giants like Microsoft, but it’s less erratic than speculative companies like Tesla. AMD’s options volume is robust, and the stock experiences price movement based on product releases, earnings reports, and shifts in market share against its competitor Intel. Traders can use options to take advantage of price moves following key announcements or to hedge positions in the semiconductor sector.
5. SPDR S&P 500 ETF Trust (SPY)
- Options Volume: Very High
- Volatility: Moderate
Why It’s a Top Pick for Options
If you’re looking for a less risky entry into options trading, the SPDR S&P 500 ETF Trust (SPY) offers an excellent way to trade the broader market. SPY tracks the S&P 500, which includes a diverse range of large-cap stocks, making it less volatile than individual equities. However, it still offers enough movement to profit from options strategies. Traders can employ a variety of strategies such as spreads, straddles, and covered calls to take advantage of market volatility. Additionally, SPY’s high options volume ensures ample liquidity for entering and exiting trades.
Conclusion
Options trading offers great potential for profit but comes with significant risks, especially for beginners. By starting with stocks that have solid liquidity, volatility, and trends, such as Apple, Tesla, Microsoft, AMD, and SPY, you’ll set yourself up for success. These stocks provide a range of opportunities for both bullish and bearish strategies, while also being manageable for those just getting started in options trading. As always, it’s important to start small, use appropriate risk management, and gain experience over time.