Strategy 1: Gaining Leverage There is value in the leverage gained using the put. With a limited amount of capital, the potential for profits is greater for put buyers than through stock short selling, and with considerably less risk. Example: Safer than Shorting Stock: A stock currently is valued at …
Read More »Sector Trading – Does Trading Sector Funds Outperform Index Funds?
One of the key advantages to index investing is that you can be assured that your performance will not be much worse than the major averages. Of course the key disadvantage to index investing is that you will not outperform the averages either. A quick look at the year end …
Read More »Understanding Stock Options Abbreviations, Part 2
First is the symbol for the stock (in this case, three letters). This is followed by a period and then a two-letter code indicating month and striking price. Distinction between call and put is part of the month code. A Wal-Mart September call with a striking price of 60 is …
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