Many investors consider options investing to be risky. There are several reasons why people think that, but let’s explore three actual risks associated with options investing. The first risk has to do with expectations management. Novice options investors expect stock prices to move quickly. While that can happen, it often doesn’t. These investors load up […]
Sometimes we forget the basics. Even in a year with low implied volatility of the market you can scratch out just under 30% profits in our long and short-term portfolios. You can also cash out out income portfolio with a 20% profit by following basic strategies, not by gambling! So let’s review the basics. Here they […]
Long-term Equity Anticipation Securities (LEAPS) are options contracts with longer expiration dates than standard options, which usually expire in a year or less. The expiration dates for LEAPS are usually over a year, but some can have up to three-year expiration dates. Investors can use LEAPS instead of buying an underlying stock outright. This strategy […]
You have probably heard or read that selling (writing) uncovered puts, also known as naked puts, is extremely risky. This is actually true, but only part of the story. The whole truth is — all market investing has risk! As with any investment strategy, there are trade-offs along with downside consequences. As a whole, selling […]
Interest rates are at historically low levels, creating investor appetite for income producing strategies. Below I present three option strategies that seek to generate income from stock positions. Covered calls The strategy consists of selling a call option against a stock position. The option is sold for an upfront premium. The option buyer acquires the […]
