Jul 14, 2012 | Option Trading Basics
What makes some stock option premiums worth so much more than others? Let’s say we have two stocks, A and B. Both are trading @ $25/share. We look to sell the same month at-the-money $25 strike and one (stock A) returns 2% and the other (stock B) 4%. WHY? The answer...
Jul 7, 2012 | Option Trading Basics
We have all heard the term “the Greeks” as it applies to stock options. Most of us know that these factors somehow explain how certain parameters can impact the value of an option premium. To avoid facing some members of the BCI community claiming that...
Jun 30, 2012 | Investment Basics, Options Trade Execution
Executing our stock and call option trades is fast and efficient. But what actually goes on behind the scenes after we enter market or limit orders? Once we type our order to the online discount broker there are a series of events that take place terminating in the...
Jun 18, 2012 | Option Trading Basics, Options Calculations, Stock Option Strategies
Whenever a study is performed on covered call writing a stock is selected and the nearest out-of-the-money (O-T-M) strike price is sold. This is repeated over and over and then the results are compared to the overall market performance. The usual conclusion is that...
Jun 16, 2012 | Exchange-Traded Funds, Stock Option Strategies
As covered call writers we strive to generate monthly cash flow by selling call options in a conservative, low-risk environment. This approach is quite appealing to many retail investors but many look to fund managers to take advantage of this great strategy. As a...
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