Asset based analysis is one of the oldest and most fundamental ways to determine the intrinsic value of a stock. Benjamin Graham strongly advocated for this approach in his 1934 book, Security Analysis. Furthermore, Graham consistently invested in stocks using asset-based analysis throughout his six decade career. The question is, does it still work? Relevant […]
Asset based analysis is one of the oldest and most fundamental ways to determine the intrinsic value of a stock. Benjamin Graham strongly advocated for this approach in his 1934 book, Security Analysis. Furthermore, Graham consistently invested in stocks using asset-based analysis throughout his six decade career. The question is, does it still work? Relevant […]
Russ argues that the election may have less of an impact on markets than many are expecting. With the summer over and the presidential debates just around the corner, investor attention is increasingly turning to the U.S. election. In my travels and meetings, I frequently encounter two strongly held views about the election’s investment implications: […]
Apple is shaking up the tech scene with a new round of iPhones, but will it be enough to turn the tables for the faltering tech stock? Find out which two stocks will profit most from the newest release of the iPhone. Apple (NASDAQ: AAPL) has done it again, shaking up the technology field with […]
As we contemplate the upcoming U.S. presidential election one of our chief investment related concerns is the potential for the election results to roil markets. Strangely, the equity markets trade as if the election results, be it a Clinton or Trump victory, are inconsequential for share prices. That stance is greatly at odds with what […]
In a previous post, I discussed five steps investors must take in order to buy low and sell high in the stock market. Those five steps boiled down to this simple fact: You must be a contrarian investor in order to profit in the stock market. So what is a contrarian investor and how do […]
Is the bell tolling for alternatives? Investors seem to think so. But despite recent poor performance, alternatives have a long life ahead and will be vitally important in the years to come, in our view. It’s clear from our conversations with clients that many people are losing faith in alternative investments. “I tried alternatives,” they […]
And it’s not a risky small cap stock either. You can earn up to 100% returns on this stalwart blue chip bank by using specific options contracts detailed in this article that have even less downside risk than owning shares of this stock. BANK BREAKOUT – DOW Downer CITIGROUP ready for rebound… The post financial […]
Those investors who want to put reward to risk in their favor with distressed and discounted stocks can use long options to leverage upside potential with a small cash outlay compared to buying shares outright. SUPERMARKET SALE STRATEGY – with a WHOLE lot of time to be right… Food is falling…bread, beef, chicken, eggs, and […]
However, by using options contracts to control 100 shares of the stock you can reap huge rewards, upwards of 100% and higher, with limited downside. With the stock now bottoming to long-term support levels, now is the best time to buy these options contracts. DIGGING OUT OF A HOLE The U.S. dollar direction has had […]
For some investors the volatility in energy prices, particularly crude oil, has been nothing but headache. However, for those investors willing to use long options on oil, the rewards will far exceed the risk. This is particularly true when using a small outlay to leverage your upside potential. What a beginning of August it was […]
Options. They’re supposed to deliver you 1000% returns overnight, week after week right? That’s what a lot of these internet trading “gurus” will tell you anyway… But the reality is far different. Options are a zero-sum game. When one person wins, another loses. The winners are few. First you have the highly efficient market makers. […]
With an excess demand for risk in the air and stocks continuing to climb a Brexit wall of worry higher, Bank of America Merrill Lynch (in a note titled “Excess demand for risk”) has a relative value trade it thinks institutional investors should consider. Significant credit / equity spread dispersion as panic is subsiding Fear, […]
By studying the long-term performance of professional sports teams, investors can gain a sense of a stock’s future returns. Mean reversion controls stock market returns as much as the outcome of sports competitions. It’s easy for sports fans to assume a championship team will continue its stellar performance into the next season. It’s equally easy for investors to extrapolate a […]
Today I want to take an in-depth look at what James O’Shaughnessy, author of What Works on Wall Street, found to be the best historical value metric… the price to sales ratio. I’ll discuss how to calculate it, what it tells us, and how you can incorporate the metric in your investing approach. What Is Price To […]
By studying the long-term performance of professional sports teams, investors can gain a sense of a stock’s future returns. Mean reversion controls stock market returns as much as the outcome of sports competitions. It’s easy for sports fans to assume a championship team will continue its stellar performance into the next season. It’s equally easy […]
It’s time for the third installment in our tutorial series on option theory. In the last two installments we we covered option basics and then did our best to give you a head start on how to interpret option greeks. Today we’re going to jump right into debit spreads and explain why they often may be preferable to trading […]
It’s time for the second installment in our option basics tutorial series. Today we are going to cover the option greeks – which is commonly considered a dry topic. Well that was until now – so grab a short sword and a bottle of body oil because you’re going to need it down in the dusty arena when […]
In the context of reintroducing option related strategies here at Evil Speculator I find it important that we establish a baseline of fundamental option related concepts for everyone. Perhaps you’ve never traded options before or maybe you’re just a bit rusty and could use a refresher. So let’s start with the very basics: WHAT IS AN OPTION […]
Binary options are a relatively new trading method which became popular after its approval by U.S. Securities and Exchange Commission in 2008. Binary options require users to predict the future price movement of an underlying asset and they can gain up to 80% profit based on the outcome of the trade. Users need to choose […]
While the market tests new highs, some stocks and ETFs seem destined to fall. These three contrarian plays make great trades right now, and could be some of your most profitable moves for all of 2016. Changes are coming in three major areas of the market, and being on the right side of these trends […]
When I first started trading, I ignored the Dow Jones Industrial Average and its ETFs (DIA) because – after all – why would I limit myself to the 30 most popular stocks? But now, as an options trader, I find myself almost limited to those stocks that are most liquid. Because of this, I’ve looked […]
Follow any of these three easy to understand, step-by-step strategies that detail exactly how any investor can profit from the collapse in biotech. The biotech sector is a bursting bubble. Unfortunately, making money from a bursting bubble requires investors to go short on a stock. Shorting a stock exposes an investor to a theoretically infinite […]
In response to a recent article I wrote on the Gold Trust ETF (GLD) some readers have asked my thoughts on gold miners. While my last article was more of a bullish thesis on gold from a fundamental perspective and offered a simple strategy of playing gold by buying GLD, this article on the Market […]
Options Trading Strategies After The Fed Meeting Well, we can pretty much shut down for the year now, right? Arguably the biggest event of the year has come and gone, and it’s time for holiday vacation. No, I’m not talking about the release of the new Star Wars movie, although that’s certainly a huge deal […]
Using an easy to understand options strategy, you can purchase this undervalued and attractive stock at a 10% discount to its current price or get paid real cash income not to. Professional money managers use this strategy to build positions in stocks at a discount while also earning a regular income stream. Rates are ridiculously […]
Let’s discuss the downsides to options no one ever mentions. The reason no one talks about these pitfalls is that it’s against the system’s best interest. The system wants retail traders churning their accounts at brokerages with tons of options trades. The more trades the better. Brokers earn fat commission fees and their affiliates that […]
Financial economists divide the value of a company’s equity into two components: the value of “assets in place” and the value of “growth options.” Although unfamiliar to many investors, the division is a highly useful tool. To see why, both components must be defined clearly. The first component, assets in place, has two parts. The […]
Options are typically seen as complex and risky. They may be complex, but they need not be risky. In fact, options are a great tool for making the risk/return menu more complete. In that regard, I think they deserve a close look now. The reason is that given the immense run-up in the market since […]
Options Trading Is Much Better Than Stock Trading This is an options trading site, so of course we spend a lot of time talking about the benefits of options. I regularly point out the virtues of using options instead of stocks. That should come as no surprise to most people who trade options regularly. Yet, […]
Options traders can use S&P 500 options or interest rate ETFs like TLT to trade economic activity.
Today I will introduce an aspect of volatility that you most likely have not seen being addressed anywhere else: realized volatility profiles. First up let’s make sure you all understand what realized volatility (RV) is and how it compares to implied volatility (IV). Simply RV measures the amount and amplitude of price change observed in […]
Big Time VIX Trades Could Mean Volatility Is About To Decrease The VIX continues to generate plenty of financial news as it remains elevated above normal levels. Volatility has started to settle in recent days, but don’t expect a complete capitulation until after the next Fed meeting. As a reminder, the VIX (S&P 500 Volatility […]
Major VIX Action Suggests Volatility Is Going To Decline The VIX has been front and center in the financial news lately with all the volatility that’s hit the market the past couple weeks. The collapse of the Chinese economy is spooking investors and adding a sizeable level of uncertainty to US financial markets. As a […]
Why Is The VIX So High? Unless you’ve had no contact with civilization over the past week, you’re likely aware that the stock market has gone through something of a correction. Moreover, volatility has been through the roof. In fact, the VIX reached its highest level since 2011. As a brief reminder, the VIX (S&P […]
Big Time VIX Action Suggests A Mostly Calm August The VIX (S&P 500 Volatility Index) is a measure of implied volatility levels on S&P 500 options. As many of you know, the VIX is often considered the market’s fear gauge. Overall market volatility is most commonly tracked by watching the VIX. For those who are […]
Does Recent VIX Action Suggest A Market Meltdown Is Coming? Savvy investors know that VIX options are always worth keeping an eye on. It’s where the smart money tends to execute important trading strategies and portfolio hedges. Some of the biggest trades you’ll ever see happen in the VIX options pit. Of course, the VIX […]
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