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Essential Options Trading Guide
Options trading may seem overwhelming at first, but it’s easy to understand if you know a few key points. Investor portfolios are usually constructed with several asset classes. These may be stocks, bonds, ETFs, and even mutual funds. Options are another asset class, and when used correctly, they offer many advantages that trading stocks and ETFs alone cannot.
- An option is a contract giving the buyer the right, but not the obligation, to buy (in the case of a call) or sell (in the case of a put) the underlying asset at a specific price on or before a certain date.
- People use options for income, to speculate, and to hedge risk.
- Options are known as derivatives because they derive their value from an underlying asset.
- A stock option contract typically represents 100 shares of the underlying stock, but options may be written on any sort of underlying asset from bonds to currencies to commodities.
What Are Options?
Options are contracts that give the bearer the right, but not the obligation, to either buy or sell an amount of some underlying asset at a pre-determined price at or before the contract expires. Options can be purchased like most other asset classes with brokerage investment accounts.
Options are powerful because they can enhance an individual’s portfolio. They do this through added income, protection, and even leverage. Depending on the situation, there is usually an option scenario appropriate for an investor’s goal. A popular example would be using options as an effective hedge against a declining stock market to limit downside losses. Options can also be used to generate recurring income. Additionally, they are often used for speculative purposes such as wagering on the direction of a stock.
There is no free lunch with stocks and bonds. Options are no different. Options trading involves certain risks that the investor must be aware of before making a trade. This is why, when trading options with a broker, you usually see a disclaimer similar to the following:
Options involve risks and are not suitable for everyone. Options trading can be speculative in nature and carry substantial risk of loss.
Options as Derivatives
Options belong to the larger group of securities known as derivatives. A derivative’s price is dependent on or derived from the price of something else. As an example, wine is a derivative of grapes ketchup is a derivative of tomatoes, and a stock option is a derivative of a stock. Options are derivatives of financial securities—their value depends on the price of some other asset. Examples of derivatives include calls, puts, futures, forwards, swaps, and mortgage-backed securities, among others.
Call and Put Options
Options are a type of derivative security. An option is a derivative because its price is intrinsically linked to the price of something else. If you buy an options contract, it grants you the right, but not the obligation to buy or sell an underlying asset at a set price on or before a certain date.
A call option gives the holder the right to buy a stock and a put option gives the holder the right to sell a stock. Think of a call option as a down-payment for a future purpose.
Call Option Example
A potential homeowner sees a new development going up. That person may want the right to purchase a home in the future, but will only want to exercise that right once certain developments around the area are built.
The potential home buyer would benefit from the option of buying or not. Imagine they can buy a call option from the developer to buy the home at say $400,000 at any point in the next three years. Well, they can—you know it as a non-refundable deposit. Naturally, the developer wouldn’t grant such an option for free. The potential home buyer needs to contribute a down-payment to lock in that right.
With respect to an option, this cost is known as the premium. It is the price of the option contract. In our home example, the deposit might be $20,000 that the buyer pays the developer. Let’s say two years have passed, and now the developments are built and zoning has been approved. The home buyer exercises the option and buys the home for $400,000 because that is the contract purchased.
The market value of that home may have doubled to $800,000. But because the down payment locked in a pre-determined price, the buyer pays $400,000. Now, in an alternate scenario, say the zoning approval doesn’t come through until year four. This is one year past the expiration of this option. Now the home buyer must pay the market price because the contract has expired. In either case, the developer keeps the original $20,000 collected.
Call Option Basics
Put Option Example
Now, think of a put option as an insurance policy. If you own your home, you are likely familiar with purchasing homeowner’s insurance. A homeowner buys a homeowner’s policy to protect their home from damage. They pay an amount called the premium, for some amount of time, let’s say a year. The policy has a face value and gives the insurance holder protection in the event the home is damaged.
What if, instead of a home, your asset was a stock or index investment? Similarly, if an investor wants insurance on his/her S&P 500 index portfolio, they can purchase put options. An investor may fear that a bear market is near and may be unwilling to lose more than 10% of their long position in the S&P 500 index. If the S&P 500 is currently trading at $2500, he/she can purchase a put option giving the right to sell the index at $2250, for example, at any point in the next two years.
If in six months the market crashes by 20% (500 points on the index), he or she has made 250 points by being able to sell the index at $2250 when it is trading at $2000—a combined loss of just 10%. In fact, even if the market drops to zero, the loss would only be 10% if this put option is held. Again, purchasing the option will carry a cost (the premium), and if the market doesn’t drop during that period, the maximum loss on the option is just the premium spent.
Put Option Basics
Buying, Selling Calls/Puts
There are four things you can do with options:
- Buy calls
- Sell calls
- Buy puts
- Sell puts
Buying stock gives you a long position. Buying a call option gives you a potential long position in the underlying stock. Short-selling a stock gives you a short position. Selling a naked or uncovered call gives you a potential short position in the underlying stock.
Buying a put option gives you a potential short position in the underlying stock. Selling a naked, or unmarried, put gives you a potential long position in the underlying stock. Keeping these four scenarios straight is crucial.
People who buy options are called holders and those who sell options are called writers of options. Here is the important distinction between holders and writers:
- Call holders and put holders (buyers) are not obligated to buy or sell. They have the choice to exercise their rights. This limits the risk of buyers of options to only the premium spent.
- Call writers and put writers (sellers), however, are obligated to buy or sell if the option expires in-the-money (more on that below). This means that a seller may be required to make good on a promise to buy or sell. It also implies that option sellers have exposure to more, and in some cases, unlimited, risks. This means writers can lose much more than the price of the options premium.
Why Use Options
Speculation is a wager on future price direction. A speculator might think the price of a stock will go up, perhaps based on fundamental analysis or technical analysis. A speculator might buy the stock or buy a call option on the stock. Speculating with a call option—instead of buying the stock outright—is attractive to some traders since options provide leverage. An out-of-the-money call option may only cost a few dollars or even cents compared to the full price of a $100 stock.
Options were really invented for hedging purposes. Hedging with options is meant to reduce risk at a reasonable cost. Here, we can think of using options like an insurance policy. Just as you insure your house or car, options can be used to insure your investments against a downturn.
Imagine that you want to buy technology stocks. But you also want to limit losses. By using put options, you could limit your downside risk and enjoy all the upside in a cost-effective way. For short sellers, call options can be used to limit losses if wrong—especially during a short squeeze.
How Options Work
In terms of valuing option contracts, it is essentially all about determining the probabilities of future price events. The more likely something is to occur, the more expensive an option would be that profits from that event. For instance, a call value goes up as the stock (underlying) goes up. This is the key to understanding the relative value of options.
The less time there is until expiry, the less value an option will have. This is because the chances of a price move in the underlying stock diminish as we draw closer to expiry. This is why an option is a wasting asset. If you buy a one-month option that is out of the money, and the stock doesn’t move, the option becomes less valuable with each passing day. Since time is a component to the price of an option, a one-month option is going to be less valuable than a three-month option. This is because with more time available, the probability of a price move in your favor increases, and vice versa.
Accordingly, the same option strike that expires in a year will cost more than the same strike for one month. This wasting feature of options is a result of time decay. The same option will be worth less tomorrow than it is today if the price of the stock doesn’t move.
Volatility also increases the price of an option. This is because uncertainty pushes the odds of an outcome higher. If the volatility of the underlying asset increases, larger price swings increase the possibilities of substantial moves both up and down. Greater price swings will increase the chances of an event occurring. Therefore, the greater the volatility, the greater the price of the option. Options trading and volatility are intrinsically linked to each other in this way.
On most U.S. exchanges, a stock option contract is the option to buy or sell 100 shares; that’s why you must multiply the contract premium by 100 to get the total amount you’ll have to spend to buy the call.
|What happened to our option investment|
|May 1||May 21||Expiry Date|
The majority of the time, holders choose to take their profits by trading out (closing out) their position. This means that option holders sell their options in the market, and writers buy their positions back to close. Only about 10% of options are exercised, 60% are traded (closed) out, and 30% expire worthlessly.
Fluctuations in option prices can be explained by intrinsic value and extrinsic value, which is also known as time value. An option’s premium is the combination of its intrinsic value and time value. Intrinsic value is the in-the-money amount of an options contract, which, for a call option, is the amount above the strike price that the stock is trading. Time value represents the added value an investor has to pay for an option above the intrinsic value. This is the extrinsic value or time value. So, the price of the option in our example can be thought of as the following:
|Premium =||Intrinsic Value +||Time Value|
In real life, options almost always trade at some level above their intrinsic value, because the probability of an event occurring is never absolutely zero, even if it is highly unlikely.
Types of Options
American and European Options
American options can be exercised at any time between the date of purchase and the expiration date. European options are different from American options in that they can only be exercised at the end of their lives on their expiration date. The distinction between American and European options has nothing to do with geography, only with early exercise. Many options on stock indexes are of the European type. Because the right to exercise early has some value, an American option typically carries a higher premium than an otherwise identical European option. This is because the early exercise feature is desirable and commands a premium.
There are also exotic options, which are exotic because there might be a variation on the payoff profiles from the plain vanilla options. Or they can become totally different products all together with “optionality” embedded in them. For example, binary options have a simple payoff structure that is determined if the payoff event happens regardless of the degree. Other types of exotic options include knock-out, knock-in, barrier options, lookback options, Asian options, and Bermudan options. Again, exotic options are typically for professional derivatives traders.
Options Expiration & Liquidity
Options can also be categorized by their duration. Short-term options are those that expire generally within a year. Long-term options with expirations greater than a year are classified as long-term equity anticipation securities or LEAPs. LEAPS are identical to regular options, they just have longer durations.
Options can also be distinguished by when their expiration date falls. Sets of options now expire weekly on each Friday, at the end of the month, or even on a daily basis. Index and ETF options also sometimes offer quarterly expiries.
Reading Options Tables
More and more traders are finding option data through online sources. (For related reading, see “Best Online Stock Brokers for Options Trading 2020”) While each source has its own format for presenting the data, the key components generally include the following variables:
- Volume (VLM) simply tells you how many contracts of a particular option were traded during the latest session.
- The “bid” price is the latest price level at which a market participant wishes to buy a particular option.
- The “ask” price is the latest price offered by a market participant to sell a particular option.
- Implied Bid Volatility (IMPL BID VOL) can be thought of as the future uncertainty of price direction and speed. This value is calculated by an option-pricing model such as the Black-Scholes model and represents the level of expected future volatility based on the current price of the option.
- Open Interest (OPTN OP) number indicates the total number of contracts of a particular option that have been opened. Open interest decreases as open trades are closed.
- Delta can be thought of as a probability. For instance, a 30-delta option has roughly a 30% chance of expiring in-the-money.
- Gamma (GMM) is the speed the option is moving in or out-of-the-money. Gamma can also be thought of as the movement of the delta.
- Vega is a Greek value that indicates the amount by which the price of the option would be expected to change based on a one-point change in implied volatility.
- Theta is the Greek value that indicates how much value an option will lose with the passage of one day’s time.
- The “strike price” is the price at which the buyer of the option can buy or sell the underlying security if he/she chooses to exercise the option.
Buying at the bid and selling at the ask is how market makers make their living.
The simplest options position is a long call (or put) by itself. This position profits if the price of the underlying rises (falls), and your downside is limited to loss of the option premium spent. If you simultaneously buy a call and put option with the same strike and expiration, you’ve created a straddle.
This position pays off if the underlying price rises or falls dramatically; however, if the price remains relatively stable, you lose premium on both the call and the put. You would enter this strategy if you expect a large move in the stock but are not sure which direction.
Basically, you need the stock to have a move outside of a range. A similar strategy betting on an outsized move in the securities when you expect high volatility (uncertainty) is to buy a call and buy a put with different strikes and the same expiration—known as a strangle. A strangle requires larger price moves in either direction to profit but is also less expensive than a straddle. On the other hand, being short either a straddle or a strangle (selling both options) would profit from a market that doesn’t move much.
Below is an explanation of straddles from my Options for Beginners course:
And here’s a description of strangles:
How to use Straddle Strategies
Spreads & Combinations
Spreads use two or more options positions of the same class. They combine having a market opinion (speculation) with limiting losses (hedging). Spreads often limit potential upside as well. Yet these strategies can still be desirable since they usually cost less when compared to a single options leg. Vertical spreads involve selling one option to buy another. Generally, the second option is the same type and same expiration, but a different strike.
A bull call spread, or bull call vertical spread, is created by buying a call and simultaneously selling another call with a higher strike price and the same expiration. The spread is profitable if the underlying asset increases in price, but the upside is limited due to the short call strike. The benefit, however, is that selling the higher strike call reduces the cost of buying the lower one. Similarly, a bear put spread, or bear put vertical spread, involves buying a put and selling a second put with a lower strike and the same expiration. If you buy and sell options with different expirations, it is known as a calendar spread or time spread.
Combinations are trades constructed with both a call and a put. There is a special type of combination known as a “synthetic.” The point of a synthetic is to create an options position that behaves like an underlying asset, but without actually controlling the asset. Why not just buy the stock? Maybe some legal or regulatory reason restricts you from owning it. But you may be allowed to create a synthetic position using options.
A butterfly consists of options at three strikes, equally spaced apart, where all options are of the same type (either all calls or all puts) and have the same expiration. In a long butterfly, the middle strike option is sold and the outside strikes are bought in a ratio of 1:2:1 (buy one, sell two, buy one).
If this ratio does not hold, it is not a butterfly. The outside strikes are commonly referred to as the wings of the butterfly, and the inside strike as the body. The value of a butterfly can never fall below zero. Closely related to the butterfly is the condor – the difference is that the middle options are not at the same strike price.
Because options prices can be modeled mathematically with a model such as the Black-Scholes, many of the risks associated with options can also be modeled and understood. This particular feature of options actually makes them arguably less risky than other asset classes, or at least allows the risks associated with options to be understood and evaluated. Individual risks have been assigned Greek letter names, and are sometimes referred to simply as “the Greeks.”
Below is a very basic way to begin thinking about the concepts of Greeks:
Teacher training entry requirements in England
UCAS Teacher Training: Eligibility for teaching
Arranging school experience independently
Subject knowledge enhancement explained
School experience programme (SEP)
Here are the entry requirements you’ll need for training programmes in England. Find out about the entry requirements for training programmes in Wales.
The teaching profession looks for the highest quality candidates, so you’ll need to meet the following requirements before you can be accepted for a training programme. Some training programmes have many more applications than places available, so their requirements might be higher.
- For postgraduate teacher training programmes, you’ll need to hold an undergraduate degree awarded by a higher education provider in England or Wales, or a recognised equivalent qualification.
- You’ll need to have achieved a standard equivalent to grade C/4, or above, in the GCSE examinations in English and mathematics.
- If you intend to train to teach pupils aged 3 – 11 (early years and primary), you must also have achieved a standard equivalent to a grade C/4, or above, in a GCSE science subject examination.
What’s happened to the skills test?
The skills test is no longer part of the entry requirements for Teacher Training in England. Instead, the DfE are replacing the skills test with a new approach, designed with (and delivered by) providers. The new approach will allow providers to work with candidates to help them develop their literacy and numeracy skills throughout their course, if needed. However, trainees who remain unable to meet the required level of literacy and numeracy skills will not reach Qualified Teacher Status.
For more information about the entry requirements for your chosen training programme, please contact the training provider.
If you haven’t achieved the required GCSEs, there are options to study the qualifications through local colleges or at home, through organisations like NEC (National Extension College).
Subject knowledge enhancement (SKE) courses
If your degree subject doesn’t link closely to your chosen teaching subject, you may still be able to apply for a postgraduate teacher training programme by undertaking a subject knowledge enhancement (SKE) course. Training providers may ask you to take an SKE course as a condition of your offer if they feel you have the right qualities to become a teacher, but need more subject knowledge first.
- SKE courses are available in maths, physics, languages, biology, chemistry, computing, English, geography, and design and technology. They can be full-time or part-time, classroom-based or online. Contact your chosen training provider and ask them about their SKE offer.
- SKE courses last between eight and 28 weeks, depending on the subject you want to teach and how closely related your subject knowledge is. Most applicants complete their SKE course immediately prior to starting their teacher training programme.
- SKE courses are fully funded, so you won’t have to pay any tuition fees. You may also be eligible for a tax-free SKE training bursary – these are paid by your training provider, so we recommend you get in touch to find out what financial support you would receive before you apply.
As teaching involves working with children on a daily basis, there are some non-academic requirements you’ll need to meet to make sure teaching’s the right job for you.
1. School experience
If you can spend some time observing and helping out with lessons in a local school before you apply, it will help to strengthen your application. You can use the experience in your personal statement, showing what you’ve gained from it and how it’s increased your motivation to be a teacher. There are several ways you can get school experience:
You can register with Get Into Teaching and search for participating schools in your area via the Get School Experience service.
2. Medical fitness
When you accept a place on a training programme, your training provider may send you a health questionnaire to find out about your medical fitness.
- Some applicants may be asked to have a medical examination.
- If you have a disability, it’s helpful if you give us full details on your application, so training providers can try to make any adjustments you may need.
3. Declaration of criminal convictions
If you have a criminal record, it won’t necessarily prevent you becoming a teacher. You’ll need to disclose any criminal convictions, cautions, or bind-overs, and you’ll need to agree to an enhanced criminal record check. We also advise you to discuss your circumstances with training providers before you apply.
4. Disclosure and Barring Service (DBS) in England and Wales
This is the Government scheme that replaced the Criminal Records Bureau. This enables training providers to identify people who are barred from working with children and vulnerable adults. Check with the DBS to see what you need to do to comply with these arrangements.
IELTS Writing Task 2 example answers
Practising IELTS Writing tasks 2
In this post, we’re going to look at some examples of answers to an IELTS Writing task 2 question and comment on their strengths and weaknesses. We’ll also talk about what the writer could do to get a better score in each case. The sample answers were written by course participants on the IELTS Preparation Course here at The London School of English. You can also see sample answers to a part 1 writing task in our previous blog post.
IELTS task 2 is the essay question. Here’s an example of a possible question, followed by two different answers.
Some people claim that not enough of the waste from homes is recycled. They say that the only way to increase recycling is for governments to make it a legal requirement. To what extent do you think laws are needed to make people recycle more of their waste?
In recent years, the household waste are considerably increasing. In addition, nobody try to fix the problem and call the government to solve it. Many people think that the authority should make some laws to maintain the recycling process. I will discuss about legal requirement as a way to increase recycling and the other ways.
Firstly, should it be compulsory for people to recycle their waste? The environmental issue is one of the main problem of our world and we don’t help it. Government should make some decisions about recycling and maybe put some taxes on income about this. For example, if you don’t respect the good bin or if you product too much waste you should be punish. Usually, people only do the right thing because of rules, so it might be possible to change a person as an eco-friendly. Moreover, instead of punishing people they could give people a reward for their good action or even a large number of recycled waste.
On the other hand, many ways could also enhance the responsibility to recycle. Laws are not the only outcome, there is also the way to reward someone. In Peking, people can change plastic bottle for underground ticket for example. This could be a reason that people recycle more and try to be more aware about ecology. In addition, in some countries the sensibilisation about recycling is well-known in school. Teachers are teaching to children how to recycle their waste, why and where put their waste. Sooner people are aware and better will improve the recycling process.
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To sum up, regulate this process could give desire to people to recycle their domestic waste. However, even with taxes and rules about recycling people should be reward. In addition to the government, school should have a great impact and highlight how important are there actions since the youngest age. As far as I am concerned, I think that if people recycle less they should reduce their waste.
The candidate has generally answered the question well. He has discussed the main idea in the task, using laws to make people recycle, but he has also discussed other options (rewarding people and education). Some of the candidate’s ideas are not clear or need to be developed more, for example when he talks about putting taxes on income. The answer is generally well-organised; it has four paragraphs, and each one has a clear function (introduction/discussion of using laws/discussion of other options/conclusion). There is a good range of linking expressions (‘firstly’, ‘for example’, ‘moreover’, ‘on the other hand’) although there is also some repetition (the idea about rewarding people is mentioned at the end of the second paragraph and again at the beginning of the third paragraph). His use of vocabulary is generally clear, and he tries to use some less common vocabulary, but it isn’t always accurate. For example, ‘respect the good bin’ should be ‘place your rubbish in the right container’, and ‘sensibilisation’ should be ‘raising awareness’ (in both cases the candidate has translated from his own language). In terms of grammar, there are again some good complex sentences (‘instead of punishing people they could give a reward’) but there are also quite a few errors, for example with tenses (‘in recent years the household waste are increasing’ , ‘nobody try’) and participles (‘you should be punishED’, ‘people should be rewardED’.)
This answer would probably achieve 6.5. Its strengths are its organisation and the fact that the writer has addressed the task well and his position is generally clear. However, the errors in grammar and vocabulary mean that it cannot be higher than 6.5.
Some people believe that the amount of recycled household waste is insuficient. Recycling is very important to decreace waste and protect environment. However, people may not increase recycling if they are led to recycle compulsory by laws. In this essay, I will look at the way to rise recycling by laws or others and explain my opinion.
Making laws is might be the best way to encourage people to recycle because not many people try to recycle from their own motive. For example, when they purchase beverage cans made from aluminium, they are able to recycle them to reuse. Although they need to wash, crush and bring them to a collecting place. This process can make people bother. Consequently, they might be not willing to recycle because it is easier to throw them away. When there are laws regarding to recycling, people are forced to recycle, which contributes to increase recycling rate with a high possibility.
On the other hand, there are other ways to compel people to recycle effectively. One of the ways is giving rewards to people who recycle many times. Rewarding such as money and discounts encourage them to rise recycle. If people are able to get discount tickets whenever they bring something to recycle, they may recycle enthusiastically. In addition, education is possible to increase recycling. If people learn the importance of recycling and how to recycle from their childhood, they can do without any special efforts.
In conclusion, introducing legislation maybe let people recycle more effectively, however, rewarding or educate them also can become good methods. In my opinion, I think laws are essential to force people to recycle more, because they do not need motivations which is difficult to maintain.
This candidate has also answered the question well. She has addressed the main idea of the task (making recycling compulsory) but also other solutions (rewarding people and education). However, there is also some irrelevant information, for example in the second paragraph about the process of recycling. This answer is also effectively organised; the writer has also used four paragraphs and each one has a clear function. Again, there is a wide range of linking expressions (‘for example’, ‘although’, ‘consequently’, ‘in addition’, ‘in conclusion’). However, there is some repetition of vocabulary which could be avoided (the words ‘recycle’ and ‘recycling’ are used eight times in the third paragraph). In terms of grammar, there are some good complex structures (‘when there are laws…..people are forced….which contributes to….’) along with a few basic errors (‘making laws is might be’). The candidate’s use of vocabulary is generally clear and understandable, but not always accurate or natural (‘rise recycling’, ‘education is possible to increase recycling’, ‘can make people bother’)
This answer would probably also achieve a 6.5. It could be improved by saying more about why laws on recycling might be a good idea, rather than discussing why people avoid recycling. Better use of referencing words (‘it’, ‘this’, etc.) would help to avoid the repetition that we mentioned previously. Also, if the candidate’s vocabulary were more accurate she would have a better chance of increasing her score.
If you have been reading our series on IELTS tips and strategies, it probably means that you are preparing to take IELTS. So, all the best for your exam! If you would like more help preparing for the IELTS exam, have a look at the links below to find information about our IELTS preparation courses and the rest of our IELTS tips blog posts.
This post was written by Daragh, one of our trainers at The London School of English.
IELTS Preparation Courses at The London School of English
We offer four-week and eight-week IELTS preparation courses. These intensive courses focus on language skills and exam techniques that will help you to get the score you need:
You can also prepare for IELTS with our Online Course, which has over 150 hours of content:
6 DIFFERENCES BETWEEN TEACHING ADULTS AND YOUNG LEARNERS
Published 16th January 2020
One of the best things about being a TEFL teacher is the fact that you could find yourself in a range of different classrooms. You could be teaching kindergarten in Shanghai, teenagers in Buenos Aires or businessmen in Istanbul. As a TEFL teacher you need to be flexible enough to be able to cope in whatever situation you may find yourself.
So if you are a bit unsure about what it will be like teaching the different age groups, here we give you five differences between teaching adults and young learners.
Adult learners are very independent, while Young Learners aren’t. It is possible (and beneficial) to let adults work things out for themselves, organise themselves and even decide the direction of the lessons. With Young Learners, on the other hand, it is necessary to be in charge of the classroom, giving clear instructions and dealing effectively with learning strategies and classroom management.
In terms of learning, Young Learners need to be given a wide variety of activities which relate to the different senses. Activities in a Young Learner classroom should be short. With adults it is possible to spend more time on learning tasks so it is possible to engage more deeply with the learning materials.
Believe it or not, adults are generally more nervous in the classroom than Young Learners. Young Learners seem to have no fear and are willing to try anything – as long as they perceive it to be fun. Adults may feel anxious because of the fact that they are not the age of the “typical” learner and so they will approach activities with a sense of apprehension if they do not feel comfortable; they will need more positive encouragement.
Having said that, adults are more likely to be more motivated than Young Learners. Adults are generally in the classroom because they choose to or because they need to learn English for work or study, which means their motivation levels are naturally high. Young Learners usually have no choice, which means that they may lose enthusiasm if they are not interested in what is happening in the classroom.
Probably the most obvious difference is that of discipline. Teaching Young Learners is all about being able to deal with discipline calmly and effectively. When teaching adults, disciplines should not be an issue because, well, they’re adults.
Finally, the biggest difference between teaching adults and teaching Young Learners is what the students bring to the classroom. Young Learners bring enthusiasm, curiosity and energy, while adults bring life experience. While Young Learners are still learning about the world around them, adults have already had a lifetime of experiences and have their own ideas and opinions.
Though there may be a number of differences between teaching English as a Foreign Language to adults or to Young Learners, the fundamental practices will remain the same. Encourage communication and authentic language use, utilise your students’ previous knowledge and, above all, maintain a fun atmosphere in the classroom and you will be successful no matter the age of your learners.
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