Writing covered calls is a very popular strategy in the stock market. And it can be both a great cash flow producer and a not so great means of missing a profit.
When you sell a call on a stock you already own what you are doing is giving someone else the right to buy a given stock at a ... Views: 1156
Did you know that you could get cash flow simply buy holding a stock? It’s true; in fact there are a few ways which investors can make a decent income from the stock market by simply buying and holding stocks. These are.
1. Dividends
Of course when you own a stock that is paying off a ... Views: 1290
How risky is trading? Is it something that only a few people will ever be able to do, or is it something that anyone can do?
Well anytime you are getting into a stock position you are risking money. There isn’t a way around this simple fact.
There are many market participants that ... Views: 1415
Rolling options to a later date is something that you have probably seen if you are trading options. It allows you to get out of a position you are currently in and get into a position at a later date.
I’m sure you know that all option contracts eventually expire. At that expiration date ... Views: 1427
Selling spreads can be a very profitable strategy. Instead of shooting for one or two big home runs it tries to shoot a lot of singles which eventually add up and can cause you to get a great return in your trading account.
The major benefits of selling spreads are that it.
1. Is ... Views: 1295
Should everyone learn stock trading? It can be very profitable, but that doesn’t mean that everyone should take part. Some people will probably be better off as far away from the stock market as possible. There are three traits that you must have if you want to succeed as a stock ... Views: 943
Income investing can be immensely profitable in the stock market. Here are the 4 major steps you will have to take in order to get into and manage income stocks.
1. Find a list of Dividend Stocks
There are many ways to do this. You can always do a Google search for the term list of ... Views: 1222
Whenever you enter the stock market it is a good idea to have two targets. Each one of these is critical to being successful in a given trade.
The first target someone should have is where you believe the stock will go. You do not want to just blindly buy a stock and hope that it works out ... Views: 975
What drives stock prices? It seems like there is some confusion about this. Some people might be shocked when they see a stock fall on great earnings, or vice versa.
That is because stock prices are not directly linked to the company’s profit. If a company makes a 20% return on their ... Views: 1112
There is a big difference between what successful stock traders look for and what the average wannabe looks for. The average investor wants a hot stock tip that is going to go up 10,000% and make them a millionaire overnight.
They do not even think about their specific goal for 1 trade or ... Views: 1368
Buying options can be a very profitable strategy, but it can also be a very risky strategy. Trade it correctly and you can make unbelievable gains. Trade it incorrectly and it can take your account to $0 faster than you would have even imagined possible.
I like to trade options every now ... Views: 908
Covered calls can be a very profitable strategy. That has made it one of the most used strategies in the stock market for both traders and investors. But what does it offer that makes it such a workable approach?
1. Money Now
You make money the second you enter a covered calls trade. It ... Views: 879
Stock splits can be extremely profitable things. When a stock splits it lowers the price that its shares are trading at and increasing the amount of shares it has to compensate.
For example when a $20 stock has a 2 for 1 split the stock becomes worth $10, however there are twice as many ... Views: 1287
Starting to invest when you are really young has many great benefits. In fact it is one of the wisest things you can do from a financial standpoint.
So why is it so important?
1. Time
The younger you start to invest the more time you will have to make money in the stock market. If ... Views: 1095
Some people seem to believe that the professional traders got that way by not being wrong. That they can somehow pick a stock that is going to shoot up 200% in the next couple of months. This is what leads a lot of people to just buy and hope for the best.
Well, if everyone just bought and ... Views: 1050
I read an article that was saying one of the most important things to know about the stock market is when to go all in. Well I kind of agree, you got to know that there is never a good time to go all in.
If you ever watch the world series of poker you will find that it is a very similar game ... Views: 1007
It is easy to ignore the losing side when trading spreads. Especially when trading out of the money credit spreads and are winning 80+% of the time.
But unless a trader can manage their risk they will eventually lose all of their money. This goes with credit spreads as well. So it is ... Views: 1265
One great strategy is selling covered calls. This strategy is pretty simple, but sometimes the simple strategy is the best.
When you sell a call on a stock that you already own, you are giving someone else the right to buy that stock from you at a given strike price. For this right you are ... Views: 987
Not many people realize that selling puts can be a very good strategy in the stock market. It can be a great source of income and help you get into stocks that you already like at a lower price.
It works like this you sell someone else the right to sell a stock at a certain strike price on ... Views: 2976
The troubled trader is someone who just can’t seem to make it in the trading world. They may have learned a lot in the past, but are still having trouble making consistent gains.
If you are in this situation these tips can help you out.
1. Turn Off the News
It is very tempting to look ... Views: 1313
When trading in the stock market one of the most important things that you can have is patients. You want to be able to wait until the time is just right before you get in.
Anyone can create their own trading rules but actually following those rules is what sets apart the people who are ... Views: 952
Too many people try to jump into an option without having a good understanding of what it actually is. Occasionally there will be times when the stock goes up yet the call option that they bought didn’t go up with it, or even went down.
Why does this happen? Well there are a number of ... Views: 1046
Developing your own trading style is of course one of the first steps to actually trading. You cannot simply get someone else’s trading system and make it work for you because it may not fit your needs. Every person is different, and that works its way in the stock market as well.
Before ... Views: 1285
It is no secret that dividend paying stocks are a very popular investment. And there is a good reason for that. There are 3 major benefits that you get any time you are investing in dividend paying stocks.
1. They don’t have to go up
Dividend stocks do not have to go up in order for you ... Views: 1102
There are 3 ways that you can make money from a stock that you own, or an investment that you want to get into. Ideally you want to be making money all 3 ways every time you enter an investment.
The 3 ways are:
1. Dividends.
Some stocks offer a dividend, which means they actually pay you ... Views: 1038
Sideways markets can be hard to profit in if you are trying to catch every little tick. But there are still ways you can profit when stocks are flat. Here they are.
1. Covered Calls
One thing you can do is to sell covered calls. You can simply find a strong stock that you would not mind ... Views: 646
There are 5 bullish strategies that can make you a lot of money in the stock market. These strategies all have the power to turn a small portfolio of only a few thousand into a large portfolio consisting of hundreds of thousands to millions in time. If you are already making money in the stock ... Views: 757
Many traders will practice adding to a winning position as well as subtracting from a winning position. These strategies can be very helpful to let your winners grow.
Many traders will practice taking away from their position once a given level is hit. For instance say you want to buy 100 ... Views: 2549
Selling Options has its advantages and disadvantages; if you are interested in getting into option trading this is something you might want to consider.
When you sell options you are not trying to predict which way the stock will move, rather you are trying to decide which way the stock is ... Views: 3918
You may have your own personal opinions and beliefs on where a stick is likely to head, but before you pull the trigger and make the trade make sure that you actually have a technical signal on the position. Waiting will help you in many ways.
1. Stocks do not care about your opinions
Stocks ... Views: 770
I have been talking a lot about iron condors lately because they are very helpful in making money in a sideways market, and that is what we are in. But there are other ways that we can pull a monthly income from a sideways market.
One very effective method is selling a horizontal spread. For ... Views: 741
There seems to be some confusion whether or not the stock market is actually tradable. Everyone knows about buy and hold, but when they hear the words short term trading it is like taboo.
The short answer is yes, the markets are tradable. It is possible to make a fantastic return from the ... Views: 1042
Everyone has been trying to call a bottom in the market for a while. The markets have to stop going down and start going up at some point. But is that point now?
It seems like there is a lot of strong evidence supporting the bottom. Stocks are greatly undervalued; right now you can buy tons ... Views: 702
I make my trading decisions based on technical analysis. I believe in developing a trading system and following it to a tee. But I don’t take just any old trade that gives me a technical set ups of course. Before I enter a stock I like to check a few things.
1. I back test the stock, just a ... Views: 692
It is possible to make money on a down trending stock without having to short it. Maybe you want to make money as a stock falls, but would also like to make money if the stock stays still.
In this case you may want to use a bear call spread. This spread allows you to take a partially bearish ... Views: 675
Being positive is always a good thing in any aspect of life. In the trading world it is almost impossible to make money without having positive thinking.
Without a positive attitude it becomes harder to pull the trigger. You are unable to place the trade because you are unsure if it is going ... Views: 572
Selling options can be a very profitable journey. Placing combining those options into spreads can be a great way of doing this for these reasons.
1. Higher Probability
Creating credit spreads allow you to gain a much higher probability of being correct then if you just buy the stock or buy ... Views: 661
Short ETFs are one of the new inventions in the stock market. They allow people to make money as the markets are falling down. But most investors don’t use them in fact most everyone seems to have an argument why you shouldn’t use them.
There articles say silly things like if you buy them ... Views: 856
Using Technical analysis to trade the stock market gives you the greatest odds for success for many different reasons.
1. The Markets Live in the Future
It is hard to use fundamental data to predict where a stock will likely go in the short term, because the stock market lives in the future. ... Views: 795
Vertical spreads allow you to profit in the stock market without having to predict what will happen next. It involves using options and helps you make money if you can predict what will probably not happen in the future.
For example we find a stock trading at $70 and expect it to go up. We ... Views: 669
Stock options can be very profitable in the stock market provided you use them right. Whenever you are buying an option you should take some time to consider why you are buying it.
Here are some tips to figuring out when the best time to buy an option is.
1. When the Stock is giving you a ... Views: 2686
There are two major ways to trade the stock market, bottom picking and momentum investing. Most people attempt to make money by calling the tops and bottoms, but it can be more profitable to simply ride a trend until it ends.
Trading with the trend has 3 major advantages.
1. Hard To Pick ... Views: 740
Did you know there was a way to buy insurance for your stocks? It allows you to keep some of the money you have invested if your stock crashes, which could be very powerful when times are uncertain.
It works by utilizing something called a put option. When you buy a put option on a stock you ... Views: 4091
History has proven time and time again that buying long term stocks when the markets are down has been a wonderful strategy. In fact the best times to buy have always been close to the market bottoms.
That is because when the markets crash they tend to take all stocks with them. This ... Views: 589
Buying on margin can be a very powerful way to leverage your money in the stock market. Here is a question. Say you wanted to make $100 in the stock market. Would it be easier to make $100 from $500 or $1000? $1000 of course.
If you make $100 from $500 that would be a 20% increase. ... Views: 825
Buying options on up trending stocks can be a very effective strategy at times. There are many reasons why this can be so effective.
1. Trends Continue
A trend can continue for a very long time, instead of trying to call the tops or bottoms it has always been more effective to just trade with ... Views: 676
Anytime you trade stocks in the market it is normally a good idea to have a plan, but when you trade options plans are critical. You do not have the luxury of holding onto the option and hoping it will come back.
Your plan should be simple to follow and answer the following ... Views: 745
Buying pullbacks is one of the most famous strategies out there. Everyone wants to buy at the low and sell at the high right? So is it actually a good strategy?
It can be very profitable if you buy a stock as it comes down a little. This is
especially true if the longer term direction of ... Views: 1298
People associate buying puts with being risky and speculative, and they are. But that does not mean that you cannot make money by trading them. In fact there are many reasons why it works to your advantage to buy puts every now and then.
1. Stocks Can Go Down
Stocks do not only go up, they ... Views: 704
Buying a few different stocks to sell covered calls on can be a good thing or a bad thing. All basic principles of buying stocks still apply, so choose your positions carefully.
So what stocks are good candidates for covered calls?
1. Good long Term Plays
If you are going to sell covered ... Views: 813