Dec 8, 2012 | Option Trading Basics, Stock Investing, Stock Option Strategies
For covered call writers the main stock option strategy is to purchase an equity specifically for the purpose of selling the corresponding call option. The investment time frame is one to two months as earnings reports will end the “run” of even the best performing...
Dec 1, 2012 | Exchange-Traded Funds, Investment Basics, Stock Option Strategies
A critical requirement of my covered call writing system is to be properly diversified by stock, industry and cash allocation. No one stock or industry should represent more than 20% of your portfolio holdings. Owning five different stocks in five different industries...
Nov 10, 2012 | Option Trading Basics, Stock Option Strategies
An integral part of understanding option trading basics, is mastering the components that influence option value. Many option traders will look to make money as a result of a discrepancy between an option’s current market value and its theoretical value. In other...
Nov 3, 2012 | Option Trading Basics, Stock Option Strategies
JUST BECAUSE YOU BUY ITS PRODUCTS DOESN’T MEAN YOU SHOULD BUY ITS STOCK The KORS initial public offering was the topic du jour among my girlfriends at a holiday party last December. The ladies I know who invest in stocks were trying to figure out how to get in on the...
Oct 27, 2012 | Option Trading Basics, Stock Option Strategies
As safe a strategy as covered call writing is there is some risk; the risk is in purchasing the stock, not in selling the option. For this reason, some investors who sell covered calls also buy protective puts to alleviate some of the risk especially in volatile...
Oct 6, 2012 | Option Trading Basics, Stock Option Strategies
Sophia Loren once said, “It’s better to explore life and make mistakes than to play it safe. Mistakes are part of the dues one pays for a full life.” I presume she was speaking about love and romance rather than options trading, but her advice is sage in both...
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