Tag: option

Revealed: How Stock Splits Help Options Traders

| August 20, 2020 | 0 Comments
Revealed: How Stock Splits Help Options Traders

Stock splits re-entered the trading lexicon and grabbed the headlines when “Apple (AAPL),” and then “Tesla (TSLA),” announced they would be conducting a 4-for-1 and 5-for-1 stock split, respectively. Following the announcements, shares of each are up 18% for AAPL, and TSLA has zoomed up 40% in just six days. You couldn’t ask for two better […]

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Options Trading: Understanding Put-Call Parity

| June 18, 2020 | 0 Comments
Options Trading: Understanding Put-Call Parity

If I had a nickel for every time someone told me they love covered calls for their conservative income generation, but would never sell a naked put because that’s too risky, I could retire from trading. The fact is a covered call is exactly the same, in terms of both risk and reward, of selling a […]

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What Percentage Of Options Expire Worthless?

| February 21, 2020 | 0 Comments
What Percentage Of Options Expire Worthless?

One of the persistent and pernicious myths regarding options is that 80% of all options expire worthless.  The number belies the fact that most options get closed well before expiration and can create some misleading belief that selling premium is the only sure way to make money trading options. We’ve all seen the marketing emails […]

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The 6 Rookie Mistakes Options Traders Should Avoid

| December 20, 2019 | 0 Comments
The 6 Rookie Mistakes Options Traders Should Avoid

As most normal people are winding down the year and finishing up their holiday shopping, I thought this would be a good time to review some of the common mistakes traders make when using options. As shoppers have become increasingly savvy in finding online bargains and discounts, we see similar behavior spilling into other aspects of […]

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Understanding A Covered Call Strategy

| October 30, 2019 | 0 Comments
Understanding A Covered Call Strategy

The other day, I wrote about how people are piling into funds, then employ option premium-selling strategies, particularly covered calls or buy-writes. I figure it’s a good time to drill down into exactly what these strategies entail and highlight both the pros and cons. The covered call strategy is one of the most popular options strategies especially among investors that […]

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Using Covered Calls To Increase Your Return In Twitter

| February 13, 2019 | 0 Comments
Using Covered Calls To Increase Your Return In Twitter

I’ve just returned from the Orlando MoneyShow and was very impressed at the amount of investors and traders looking to learn more about options strategies. I had the opportunity to deliver two different presentations to the options-oriented folks. One of the topics I spent quite a lot of time on was covered calls. Of course, […]

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Options: 3 Approaches To A Double-Edged Sword

| September 24, 2018 | 0 Comments
Options: 3 Approaches To A Double-Edged Sword

Anyone that buys (or sells) an option contract is by definition employing leverage.  I think too many people get enamored by the notion that an option allows one to “control” or confers the rights (or obligation) to 100 shares for a fraction of the price of owning the underlying security.  The first thing to remember […]

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