Dec 23, 2017 | Exit Strategies, Investment Basics, Option Trading Basics, Options Calculations, Put-selling, Stock Option Strategies
In part I of this arbitrage series we defined arbitrage as the simultaneous purchase and sale of an asset to profit from a difference in the price. It is a trade that profits by exploiting the price differences of identical or similar financial instruments on...
Dec 16, 2017 | Investment Basics, Option Trading Basics, Options Trade Execution, Stock Option Strategies
Understanding stock and option pricing requires an awareness of arbitrage and market efficiency. Although most retail investors do not have the tools to take advantage of arbitrage opportunities, a comprehensive understanding of how it works adds to our...
Dec 9, 2017 | Covered Call Exit Strategies, Exit Strategies, Investment Basics, Option Trading Basics, Stock Option Strategies
Covered call writers and put-sellers must be aware of earnings report dates and ex-dividend dates but for different reasons. A golden rule in the BCI methodology is never to sell an option if there is and earnings report date prior to contract expiration. In July...
Dec 2, 2017 | Covered Call Exit Strategies, Exit Strategies, Investment Basics, Option Trading Basics, Stock Investing, Stock Option Strategies, Technical Analysis
Position management is one of the 3 required skills needed for covered call writing and put-selling. When share price gaps up or down there is a strong possibility that an exit strategy opportunity will present itself. There are times, however, when no action is the...
Nov 25, 2017 | Fundamental Analysis, Investment Basics, Option Trading Basics, Stock Investing, Stock Option Strategies
Covered call writers and put-sellers are aware of the value to avoiding risky events like earnings announcements. An impending FDA announcement regarding the efficacy of a new drug being tested is another example. This article will define and explore the potential...
Nov 18, 2017 | Investment Basics, Option Trading Basics, Options Calculations, Options Trade Execution, Stock Option Strategies
Covered call writers and put-sellers must set goals regarding targeted premium returns before entering trades. These objectives are based on personal risk tolerance, market assessment and chart technicals. One of the most flagrant mistakes made by option sellers is to...
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