Anyone looking for a great way to make money online may have stumbled upon ETF or Exchange Traded Funds, an investment program that offers many possibilities. Basically there are four ways you can take advantage of to make the most of ETFs.

The first is to buy a call option. Everyone has the right to buy ETFs at strike price for as long as the ETF is still valid. A classic example would be this: consider buying Dec 80 OIH for $80 at any time until the third Friday of December. Even if the OIH trades at $90, you can still buy the ETF at $80. However, if it happens that the OIH does not go beyond $80 come December, it practically renders your call void.

Keep in mind that the ETF prices are dependent on many factors, one of which the price of the ETF. Thus in order for you to make money with this strategy, you have to will that the ETF price would be more than the strike price. To illustrate, if you buy Dec 80 call for $2, the ETF has to be at least $82 so you can be in profit already. On the other hand, if the ETF stays below $80, then for every call you buy, you lose $2.00.

The opposite has to happen if you are selling a call. Instead of willing the ETF to go up, you need to keep it down. This means that if the ETF is below $80, your profit will be $2, but if it stays above $82, you must sell at $80, incurring a loss of $2.00.

Another strategy is to buy a put option. A put option is one s right to sell ETF at a desired cost. For example, you can buy the Dec 80 put and then sell the ETF for $80 before December. If the trade is set at $75, you make a profit of $5.00. This is less risky than selling a call option, and is recommended if there is enough reason to believe that the value of the ETF will decline.

Selling a put option means you are giving the put buyer every right to sell the ETF any time before it expires and at the strike price. It s like buying a call in the sense that you are looking for the ETF to go beyond the strike price in order to profit. Simply put, if you want to sell the Dec 80 put for $4, then you would not want the ETF to fall below $76, the break-even point, in which case your profit is $4 for every put you sell.

Between buying and selling options, the latter holds more risks. Nonetheless, it does not mean that you will not profit when you take this route.

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