Oct 10, 2015 | Investment Basics, Option Trading Basics, Stock Option Strategies
Contract adjustments will change our covered call writing and put-selling positions. In the past, I have written about the effect stock splits and dividends have on our positions. In this article, I will highlight another cause of these adjustments, mergers and...
Aug 16, 2014 | Covered Call Exit Strategies, Exit Strategies, Option Trading Basics, Options Calculations, Stock Option Strategies
Covered call writing positions can be altered by exit strategies or contract adjustments. Contract adjustments are alterations that are typically made to option contracts when the underlying stock undergoes a stock split, pays a special cash and/or stock dividend or...
Jan 11, 2014 | Investment Basics, Option Trading Basics, Options Calculations, Options Trade Execution
Stock options are contracts with terms that can change prior to expiration. Mergers, acquisitions, special dividends and stock splits are some of the events that may necessitate the change in terms. Since early September, New Orient Edu&Tech (EDU) has been on the...
Dec 14, 2013 | Investment Basics, Option Trading Basics, Options Calculations, Options Trade Execution, Stock Option Strategies
Options Trading Basics includes the fact that one options contract incorporates 100 shares of the underlying security. The right or the obligation is for the purchase or sale of 100 shares of stock or exchange-traded funds. This is the rule but there are exceptions to...
Apr 20, 2013 | Covered Call Exit Strategies, Options Calculations, Options Trade Execution, Stock Option Strategies
I recently learned that covered call writing comes in all shapes and sizes. Although we are honored to have a significant number of international members, most trade US stocks on US exchanges with the rules we are familiar with. But what if the rules were different?...
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