Options Trading
3 Strategies For Shorting The Bursting Biotech Bubble
Follow any of these three easy to understand, step-by-step strategies that detail exactly how any investor can profit from the collapse in biotech. The biotech sector is a bursting bubble. Unfortunately, making money from a bursting bubble requires investors to go short on a stock. Shorting a stock exposes an investor to a theoretically infinite […]
2 Options Strategies For Profits From A Hated Sector
In response to a recent article I wrote on the Gold Trust ETF (GLD) some readers have asked my thoughts on gold miners. While my last article was more of a bullish thesis on gold from a fundamental perspective and offered a simple strategy of playing gold by buying GLD, this article on the Market […]
Option Greeks
Option Greeks are metrics used to more precisely understand the behavior of an option’s price. In a nutshell, they measure the sensitivity of an option’s price in relation to several different factors. Those factors include underlying stock price, interest rate, volatility, and time decay. Traders use Option Greeks to analyze changes in the price of […]
Butterfly Spread
The butterfly spread is a neutral options strategy, also called the long butterfly spread. A trader profits from a butterfly spread when the underlying stock is stagnant or trades in a tight price range over the life of the spread. A butterfly spread is made up of three options trades at once. It can be […]
Stock Option Pricing
For most investors, understanding stock option pricing can be elusive and intimidating. While it may seem like there are many variables that go into stock option pricing, the reality is there are two parts that make up the value. Moreover, there are three distinct variables affecting an option’s price. Before we get too far along, […]
Stocks Riskier Than Options Trading?
Trading Stocks Can Be Riskier Than Trading Options There are many significant risks unique to holders and writers of options. For example, an option holder can lose their entire investment in an option if they allow it to expire worthless. The writer of naked call options risks potentially unlimited losses should the price of the […]
Stock Repair Strategy
You did your homework, picked a great stock, totally undervalued and ready for a nice price rise. However, after you bought the stock, the damn thing goes and drops 20%. So what do you do now? Do you sell it and cut your losses or do you hold on and hope that it recovers? Do […]
Options Trading Strategies To Avoid For 2016
Options Trading Strategies To Avoid For 2016 Hard to believe but 2016 is right around the corner. While the financial markets don’t really care what calendar year it is, we as investors tend to like to group market conditions by the year. For instance, 2015 will most likely be the year of tepid growth and […]
Options Trading And The New Normal
Options Trading And The New Normal As we approach the end of the year, we can start to piece together what kind of year it’s been for US stocks. There are basically two different stories to tell in 2015. There was the August correction and subsequent rebound. And, there’s been a whole bunch of range-bound […]
Finding Value With Options Trading
Finding Value With Options Trading There are many different reasons to invest in stocks. For example, some buyers are looking for growth, others income. Ultimately everyone is looking to make money… but how we get there is clearly open to interpretation. One popular method of investing is value investing. That is, when investors look for […]
