Options Trading Strategy

This Growth Stock Is A Buy On Every Dip

This Growth Stock Is A Buy On Every Dip

Investors in the artificial intelligence (AI) and chip darling Nvidia (NASDAQ:NVDA) stock saw mouth-watering returns in 2021. Over the past 12 months, NVDA stock has returned around 82%. By comparison, the PHLX Semiconductor Sector Index returned a little more than 18%. In November 2021, Nvidia shares hit a record high of $346.47. Yet, since then, it has […]

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This Stock Just Broke Out

This Stock Just Broke Out

Mondelez International, Inc. (NASDAQ: MDLZ) seems to be getting ready for a price bump as per the latest charts. Mondelēz, is an American multinational confectionery, food, holding and beverage, and snack food company based in Chicago, Illinois. Bullish Indications #1 Consolidation Area Breakout: The daily chart shows that the stock was trading within a consolidation […]

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One Way To Double Your Dividend From Corporate Bonds

One Way To Double Your Dividend From Corporate Bonds

Corporate bonds are near all-time highs as yield seekers are looking to improve on low yields from government bonds.  The iShares iBoxx $ Investment Grade Corporate Bond ETF (LQD) is one of the most popular vehicles for getting exposure to high quality corporate bonds.  However, the dividend yield is only 2.3% for LQD, and the […]

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This Stock Broke Out And Looks Ready For A Surge

This Stock Broke Out And Looks Ready For A Surge

Mosaic Co (NYSE: MOS) seems to be gearing up for a surge as per its latest charts. Mosaic Co produces and markets concentrated phosphate and potash crop nutrients in North America and internationally. The company operates through three segments: Phosphates, Potash, and Mosaic Fertilizantes. Bullish Indications #1 Symmetrical Triangle Pattern Breakout: The daily chart shows that […]

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Trade of the Week: TIP

Trade of the Week: TIP

Last week, a highly unusual amount of options action occurred in iShares TIPS Bond ETF (TIP).  TIP is a popular ETF for investing in TIPS bonds, which are treasury bonds that are indexed to inflation.  In other words, as inflation goes up, these bonds go up.  While the ETF has $38 billion in assets, it […]

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Covered Call Writing

How To Calculate Your Impressive Covered Call Returns

How To Calculate Your Impressive Covered Call Returns

Talking about investment yields and returns can be confusing, and actually understanding what happens can be even more daunting. However, we are trying to make money on our money, and understanding potential returns – both as percentages and dollars – helps separate good opportunities from those that are less attractive. If you have dabbled with […]

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Which Is Better: Covered Calls Or Cash-Secured Puts?

Which Is Better: Covered Calls Or Cash-Secured Puts?

Covered Calls and Cash-Secured puts seem to be the most popular choices among traders in finance and stocks. And for a good reason. The two trades in the same market, just on different terms. That’s right. And it all started with the same idea… Both kinds of trading are pretty much the same, except for […]

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Why Smart Investors Use Covered Calls To Profit

Why Smart Investors Use Covered Calls To Profit

Recent market volatility has both put traders on edge and pumped up the volatility in options. Those two usually go hand in hand and they create a great opportunity for longer term investors with a cooler demeanor to capitalize on the current dislocation. One of the best, and most popular approaches, especially among investors that […]

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Here’s What A One-Year Covered Call In Microsoft Looks Like

Here’s What A One-Year Covered Call In Microsoft Looks Like

In the era of ultra-low interest rates, yield enhancement strategies have become prolific. Actually, let’s take a step back. It used to be that you could generate a reasonable yield from fixed interest investments, like government or corporate bonds. However, with interest rates approaching zero, those types of investments just don’t provide robust yields. So […]

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Understanding A Covered Call Strategy

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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Options Trading Strategies

Eight Easy Tips That Can Turn Your Trades From Losers to Winners

Eight Easy Tips That Can Turn Your Trades From Losers to Winners

There are many profitable option trading strategies, but none of them will work unless you are willing to stick to a set of guiding principles. Several rules I employ are helpful in maximizing profits, limiting losses and, most importantly, taking the emotion out of trading. Below, I will go over my basic trading philosophy, why […]

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3 Santa Claus Rally Stocks To Buy

3 Santa Claus Rally Stocks To Buy

With Christmas around the corner, talk of the Santa Claus rally is making the rounds. The seasonal pattern covers the last five trading sessions of the year and the first two of the New Year. According to the Stock Traders Almanac, equities historically have a strong tailwind over these seven days. So today, I want […]

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3 Sickly Covid Stocks To Buy As Omicron Gets Around

3 Sickly Covid Stocks To Buy As Omicron Gets Around

As pandemic fears roil the market, don’t read last rites to these Covid stocks Not that it ever left entirely. But Covid-19 is back with a vengeance. Today, let’s explore three sickly-looking Covid stocks to buy which should find successful resuscitation efforts worth investing for in 2022 and beyond, whatever that might really look like. […]

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The Top 10 Stocks To Watch This Week For Possible Breakouts

The Top 10 Stocks To Watch This Week For Possible Breakouts

Picking a winning trade on a consistent basis is not simply a stroke of luck. It’s the result of calculated screening, planning, and deliberation. With this in mind, we have started a new weekly series on our top 10 stocks to watch this week — stocks that look poised for a possible breakout in the […]

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4 Top Stock Trades For Friday: Bitcoin, AAPL, PYPL, BABA

4 Top Stock Trades For Friday: Bitcoin, AAPL, PYPL, BABA

Here are the top stock trades we’re watching for Friday morning Thursday was full of more tricky and choppy trading as the monthly options expiration nears, which has traders frustrated with the action. Let’s look at how the charts are shaping up for a few top stock trades. This article originally appeared at InvestorPlace.   […]

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Options Volatility Watch

One Way To Take Advantage Of The Volatility In Tech Stocks

One Way To Take Advantage Of The Volatility In Tech Stocks

Tech stocks have the started the new year with elevated volatility and quite a bit of selling pressure.  The most popular tech index, Invesco QQQ Trust (QQQ), is down 5% for the year and has seen a handful of large percentage moves already. One strategist is looking to take advantage of the volatility by using […]

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Why December Is Shaping Up To Be A Very Volatile Month

Why December Is Shaping Up To Be A Very Volatile Month

It looked like we might coast into the end of 2021 on a calm and seasonally bullish note with the major indices up some 25% for the YTD.  But, a new Covid variant and stubbornly-high inflation have thrown a wrench into that outlook. I think December will be unusually volatile, which equates to unpredictable, which […]

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Market Volatility: Trade Cautiously But Without Fear

Market Volatility: Trade Cautiously But Without Fear

Being a market prognosticator often means spewing thoughts and opinions to create content well beyond the reality of underlying activity.  I should know, after working with Jim Cramer — the sound bite-creating master — making table-pounding proclamations and outrageous predictions, all the while, under the surface, acting as a rational, risk-averse portfolio manager. I give […]

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Is The Low Volatility Market At An End?

Is The Low Volatility Market At An End?

2019 can be roughly divided into two market regimes. There were periods of high volatility and market choppiness, notably in June, August, and early October. Then, there were the stretches of low and falling volatility – January through May and mid-October through the end of the year. It certainly seemed like January of 2020 was […]

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Protection Against A December Volatility Spike

Protection Against A December Volatility Spike

Stock market activity has essentially slowed to a crawl, and many traders are wondering if that’s it for volatility in 2019. Some traders are jokingly wondering if they should take the rest of the year off. It certainly seems like the market isn’t interested in action these days. There are certainly mechanical reasons for the […]

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Options Trading

Why Successful Traders Make More By Trading Less

Why Successful Traders Make More By Trading Less

During my 25 years of trading and mentoring others, I have been dragged through the coals a few times. And by that, I mean I have: blown up a few trading accounts; had some massive gains only to watch them turn into worthless penny stocks, and; I even had one trade based around the volatility […]

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Stop Trading Options Like Stocks (Gamestop Example)

Stop Trading Options Like Stocks (Gamestop Example)

“Options are the same as stocks, just cheaper!” Ever heard a pitch start like that? Well, it’s wrong. Crazy wrong. Options trade much differently than stocks, and thus why it’s easier to lose money with options (and this is coming from a 20+ year options trader). One key difference is… Find out here This article […]

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Using Options To Help Predict Big Market Moves

Using Options To Help Predict Big Market Moves

Options order flow, particular large or unusual block trades, can potentially help traders predict where a big market move may occur.  Large traders will often use options on ETFs in order to take a directional position on a major asset class or industry.  For example, using the iShares iBoxx $ Investment Grade Corporate Bond ETF […]

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How To Profit During October’s Earnings Season

How To Profit During October’s Earnings Season

It’s been a tumultuous 18 months since Covid first descended, roiling personal lives, businesses, and the markets.  While things keep continually flowing, we humans (prisoners to time), like to mark the days segmenting periods in order to assess past actions and set future goals. Today marks the end of Q3, as September proved to be […]

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Using Options To Protect Gains While Maintaining Upside Potential

Using Options To Protect Gains While Maintaining Upside Potential

The stock market is hitting all-time highs and investors are torn between the possibility of an economic downturn, or entering a new leg of the bull market. Last week’s article noted that money managers were increasingly using call options to gain additional exposure to the stock market.  Some of this behavior might be deemed as a reckless […]

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Options Trading Basics

Death, Taxes, And Time Decay

Death, Taxes, And Time Decay

Few things are certain in life.  But as the old saying goes, there is nothing quite so certain as “death and taxes”.  As an Options Trader, I would enthusiastically add option time decay to that list. Options offer traders and investors more leverage and risk mitigation than just purchasing shares outright. For example, if I were to […]

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Are You An Options Buyer Or An Options Seller?

Are You An Options Buyer Or An Options Seller?

Options are an increasingly popular financial product that gives traders numerous ways to manage risk while significantly leveraging capital. They are a powerful trading “tool” that can be bought, sold, and combined in a seemingly limitless number of ways to achieve a specific objective. One of the bigger questions for new — and even experienced […]

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How Do Options Work? Learn The Lingo, Pros, And Cons

How Do Options Work? Learn The Lingo, Pros, And Cons

Options trading gets a bad rap for being complicated and risky. But investors don’t seem to care, as options are becoming quite popular. When done right, becoming an options trader can actually ease the risk of owning stocks and generate extra cash for retirement. If your interest is piqued, you might be wondering, “How do […]

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The Relationship Between Volatility & Vega

The Relationship Between Volatility & Vega

Market volatility is starting to tick back up as macro headlines ranging from inverted yield curve to drones striking Saudi oil complexes to impeachment to failed IPOs have ratcheted up uncertainty and nervousness. And now we are about to enter earnings season which not only will cause big moves in the individual names but could […]

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2 Essential Options Trading Concepts That You Need To Know

2 Essential Options Trading Concepts That You Need To Know

Market volatility has contracted back down to historically low levels with the VIX, which acts as the benchmark measure, sitting just above 52-week low at the pre-teen level of 12. But, with earnings season upon us, tons of IPOs such as Uber hitting market, and pickup in mergers and acquisition activity such as Chevron’s (CVX) $33 billion […]

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