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  • Trading Options Outside The Box

    Trading Options Outside The Box

    Part of the challenge in making money trading options (or just in the financial markets in general) is the zero-sum game factor. That is, for every winning trade, there’s someone on the other side losing money. The problem is retail traders have to go up against huge trading firms and banks with endless resources. The […]

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    | November 21, 2014 | 0 Comments

Call Or Put Options?

Call Options Or Put Options On Blackberry (BBRY)?

Call Options Or Put Options On Blackberry (BBRY)?

Smartphone maker Blackberry (BBRY) is an interesting battleground stock. Will the company ever return to its former glory? BBRY shares are currently trading at $10.17, up 45% on the year. The stock is trading 19% below the 52-week high of $12.54 and is 87% above the 52-week low of $5.44. Is this an opportunity to […]

Call Options Or Put Options On Barrick Gold (ABX)?

Call Options Or Put Options On Barrick Gold (ABX)?

One of North America’s biggest gold miners, Barrick Gold (ABX), is at an important inflection point. Will positive corporate news counteract the drop in the price of gold? ABX shares are currently trading at $11.74. The stock is trading 45% below the 52-week high of $21.28 and is 8% above the 52-week low of $10.90. […]

Call Options Or Put Options On Alibaba (BABA)?

Call Options Or Put Options On Alibaba (BABA)?

China’s online and mobile commerce giant Alibaba (BABA) just reported earnings. Since this is the first earnings since the company’s big IPO, there’s plenty of action in the stock this week. BABA shares are currently trading at $109.73. The stock is now trading 3% above the previous 52-week high of $106.36 and is 33% above […]

Call Options Or Put Options On Facebook (FB)?

Call Options Or Put Options On Facebook (FB)?

Earnings for social networking giant Facebook (FB) hit the market yesterday. So of course, there’s plenty of action in the stock today. FB shares are currently trading at $75.96, up 48% for the year. The stock is trading 6% below the 52-week high of $81.16 and is 74% above the 52-week low of $43.55. Is […]

Call Options Or Put Options On Yahoo (YHOO)?

Call Options Or Put Options On Yahoo (YHOO)?

There’s been plenty of action in Yahoo (YHOO) lately. This week, it’s the company’s quarterly earnings causing the market to stir. YHOO shares are currently trading at $42.47, nearly flat for the year. The stock is trading just 1% below the 52-week high of $42.90 and is now 113% above the 52-week low of $19.80. […]

Call Options Or Put Options On Transocean (RIG)?

Call Options Or Put Options On Transocean (RIG)?

While the markets are selling off sharply, Transocean (RIG) is getting hit even harder.  RIG has been the worst performing energy stock in an already depressed sector. RIG shares are currently trading at $28.08, down 38% for the year.  The stock is trading 47% below the 52-week high of $52.72 and is now 1% below […]

Unusual Options Trading Activity

SDRL, BRCM Options – Unusual Trading Activity – November 17, 2014

SDRL, BRCM Options – Unusual Trading Activity – November 17, 2014

This week we’re taking a look at unusual options trading activity in SeaDrill (SDRL) and Broadcom (BRCM). As many of you know, unusual options volume can be a valuable indicator as to what traders are thinking, and more importantly, where these stocks are heading in the short-term. This is something professional options traders pay a lot of attention […]

XOP, AEO Options – Unusual Trading Activity – November 10, 2014

XOP, AEO Options – Unusual Trading Activity – November 10, 2014

This week we’re taking a look at unusual options trading activity in SPDR S&P Oil & Gas Exploration & Production ETF (XOP) and American Eagle Outfitters (AEO). As many of you know, unusual options volume can be a valuable indicator as to what traders are thinking, and more importantly, where these stocks are heading in the short-term. This […]

GERN, WAG Options – Unusual Trading Activity – November 3, 2014

GERN, WAG Options – Unusual Trading Activity – November 3, 2014

This week we’re taking a look at unusual options trading activity in Geron (GERN) and Walgreen (WAG). As many of you know, unusual options volume can be a valuable indicator as to what traders are thinking, and more importantly, where these stocks are heading in the short-term. This is something professional options traders pay a lot of attention […]

AMAT, BCOV Options – Unusual Trading Activity – October 27, 2014

AMAT, BCOV Options – Unusual Trading Activity – October 27, 2014

This week we’re taking a look at unusual options trading activity in Applied (AMAT) and Brightcove (BCOV). As many of you know, unusual options volume can be a valuable indicator as to what traders are thinking, and more importantly, where these stocks are heading in the short-term. This is something professional options traders pay a lot of attention […]

EFA, TIF Options – Unusual Trading Activity – October 20, 2014

EFA, TIF Options – Unusual Trading Activity – October 20, 2014

This week we’re taking a look at unusual options trading activity in iShares MSCI EAFE (EFA) and Tiffany (TIF). As many of you know, unusual options volume can be a valuable indicator as to what traders are thinking, and more importantly, where these stocks are heading in the short-term. This is something professional options traders pay a lot […]

COH, LEN Options – Unusual Trading Activity – October 13, 2014

COH, LEN Options – Unusual Trading Activity – October 13, 2014

This week we’re taking a look at unusual options trading activity in Coach (COH) and Lennar (LEN). As many of you know, unusual options volume can be a valuable indicator as to what traders are thinking, and more importantly, where these stocks are heading in the short-term. This is something professional options traders pay a lot of attention […]

Speculator's Corner

Speculator’s Corner:  Microsoft’s (MSFT) Big Hardware Gamble

Speculator’s Corner: Microsoft’s (MSFT) Big Hardware Gamble

Last week, I touched on Microsoft’s (MSFT) purchase of Nokia’s (NOK) phone business.  That article was a neutral look at the deal.  This time around, I’m going to give you my opinion on this game changing acquisition. To be more specific, I’m going to defend MSFT. You see, most of what I’ve read about the […]

Speculator’s Corner:  How To Trade LinkedIn (LNKD)

Speculator’s Corner: How To Trade LinkedIn (LNKD)

If you read or watch financial news, you’re probably hearing plenty about Facebook (FB).  After all, it’s the largest social network in the world and has something like 1 billion users.  And the stock is finally trading above its IPO price. But, there’s another online community doing extremely well – and it doesn’t get nearly […]

You’ll Never Guess Which Asset Has Been The Top Performer Over The Last Year

You’ll Never Guess Which Asset Has Been The Top Performer Over The Last Year

Imagine a basket of major assets.  In this basket are all the major stock indices, all the big commodities, and even all the major currencies (versus the Dollar).  Over the last 12 months, which of these assets do you think has performed the best? The S&P 500 is up nearly 24% over the period.  Not […]

Speculator’s Corner:  Is Tesla (TSLA) For Real?

Speculator’s Corner: Is Tesla (TSLA) For Real?

If you’ve been following stocks at all recently, then you’ve likely heard of Tesla Motors (TSLA).  It’s the “it” company right now. Tesla, of course, develops electric vehicles.  The Model S is the company’s only current automobile for sale, but another vehicle (Model X) will be available in 2014.  What makes the Model S unique […]

Speculator’s Corner:  Is Apple (AAPL) Ready To Rebound?

Speculator’s Corner: Is Apple (AAPL) Ready To Rebound?

As bad as last week was for the broad market, it was far worse for Apple (AAPL).  True, the S&P 500 was down 2% for the week, while the NASDAQ 100 dropped 2.7%.  But those don’t come close to AAPL’s steep decline of over 9% for the week. Moreover, the retail/tech giant is down 26% […]

Speculator’s Corner:  Corn Prices Getting Canned

Speculator’s Corner: Corn Prices Getting Canned

Last summer the worst drought in 70 years baked the heartland of America to a crisp.  The extreme heat and lack of rainfall baked fields of corn into worthless husks.  The drought ended up destroying 13% of last year’s corn crop.  It resulted in the smallest production since 2006. As the temperatures rose, so did […]

Breaking News

Trading Options Outside The Box

Trading Options Outside The Box

Part of the challenge in making money trading options (or just in the financial markets in general) is the zero-sum game factor. That is, for every winning trade, there’s someone on the other side losing money. The problem is retail traders have to go up against huge trading firms and banks with endless resources. The […]

How The Heck Do You Trade Oil?

How The Heck Do You Trade Oil?

One of the biggest surprises in the financial markets in 2014 has been the collapse of crude oil prices. In mid-June, West Texas Crude was trading at over $105 a barrel. Barely five months later, the price has dropped below $75. Oil hasn’t been this cheap since 2010. The mind-boggling plunge has caught many investors […]

Two Years Of Gridlock?

Two Years Of Gridlock?

The big news to kick off November is neither economic nor international for a change, it’s political. The Republicans had an impressive showing at the polls, with the GOP taking control of Congress starting in 2015. Although the outcome was basically expected, it’s the first time in eight years Republicans will have the majority in […]

What Selloff?

What Selloff?

The bull market returns with a vengeance! The S&P 500 – which was briefly flat for the year in mid-October – is back up to roughly 9% gains year-to-date. Should we be surprised? Well, the volatility certainly dried up in a hurry. But, that’s how volatility tends to work (which is why so many people […]

How To Profit Off Of Bad Earnings

How To Profit Off Of Bad Earnings

It’s earning season, so you know what that means… lots of big moves in individual equities. And this time around, there’s added volatility in the market due to the recent selloff. It seems like earnings misses are causing larger than normal downward gaps. As options traders, we know big moves can be very good if […]

Volatility Has Arrived

Volatility Has Arrived

The financial markets have been swamped with volatility in recent days, but it should come as little surprise to those of you who visit this site regularly. After all, we’ve been talking about volatility for the past several weeks. Granted, I didn’t – and still don’t – believe the markets are going to experience a […]

The Spread Trader

The Spread Trader:  Straddle On SPDR Gold Shares (GLD)

The Spread Trader: Straddle On SPDR Gold Shares (GLD)

Gold has been on an incredible, historic run.  At the end of 2008, the yellow metal was trading at roughly $700 per ounce.  For the next four years, it would do nothing but head higher. In fact, in August 2011, gold hit a high of over $1,900 per ounce.  And even though the price pulled […]

The Spread Trader:  Bull Call Spread On TIBCO Software (TIBX)

The Spread Trader: Bull Call Spread On TIBCO Software (TIBX)

TIBCO Software (TIBX) was on quite a roll going into 2012.  And for good reason… TIBCO’s “two-second advantage” gives their customers the ability to capture the right information, at the right time, and act on it preemptively for a competitive advantage. As their CEO, Vivek Ranadive, puts it…  “A little bit of the right information […]

The Spread Trader: Bear Put Spread On 3D Systems (DDD)

The Spread Trader: Bear Put Spread On 3D Systems (DDD)

Some of the hottest stocks of 2012 are those of companies that specialize in 3-D printing.  In a nutshell, 3-D printers convert digital objects in computer-aided design software or 3-D scanning and sculpting devices into physical objects made from plastic, metal, and composite print materials.  The two major players in 3-D printing are 3D Systems […]

The Spread Trader:  Bull Call Spread On Apple (AAPL)

The Spread Trader: Bull Call Spread On Apple (AAPL)

There’s no doubt about it, tech stocks have had a rough few months.  And the big daddy of all tech stocks, Apple (AAPL), has been no exception. In case you didn’t notice, after reaching a new all time high of $705 back on September 21st, Apple’s stock has tumbled $162 lower to around $543 today.  […]

The Spread Trader:  Bull Call Spread On Caterpillar (CAT)

The Spread Trader: Bull Call Spread On Caterpillar (CAT)

So far the Fed’s latest action hasn’t made a big impact on stock prices.  In fact, the markets have been trending modestly lower after an initial surge higher in the first days following the announcement of QE3. What’s behind the markets sluggish performance? Put simply, weak economic data. Despite the introduction of QE3, economic data […]

The Spread Trader:  Bull Call Spread On CBS Corp (CBS)

The Spread Trader: Bull Call Spread On CBS Corp (CBS)

Fall is here.  It’s a beautiful time of year here in Arizona.  The temperatures are falling and it’s once again tolerable to be outside… at least without a pool or some kind of air conditioning.  But it’s also a great time of year to be a couch potato.  Especially, if you’re into sports or politics. […]

Options Trading Strategies

Reverse Iron Butterfly Spread

Reverse Iron Butterfly Spread

The reverse iron butterfly spread is a complex, debit spread strategy which benefits from movement in the underlying instrument.  It’s similar in concept to a short butterfly spread, except it’s a debit spread.  A trader profits from a reverse iron butterfly spread when the underlying stock rallies or sells off. A reverse iron butterfly spread […]

Short Condor Spread

Short Condor Spread

The short condor spread is a complex credit spread strategy which benefits from movement in the underlying instrument.  A trader profits from a short condor spread when the underlying stock rallies or sells off. A short condor spread is made up of four options trades at once.  It can be done with either all calls […]

Short Straddle

Short Straddle

A Short Straddle is a neutral options strategy which produces a profit when the underlying stock doesn’t move much up or down.  It’s essentially the opposite of a Long Straddle which profits when the underlying stock makes a big move up or down. So, if you think your stock is going to move sideways for […]

Long Straddle

Long Straddle

A Long Straddle is created by buying both a put and a call with the same terms.  In other words, you buy both a put and a call on the same underlying stock, with the same strike price, and the same expiration date. A straddle purchase allows the buyer to make big potential profits if […]

Iron Butterfly Spread

Iron Butterfly Spread

The iron butterfly spread is a complex, neutral, credit spread strategy, similar to a long butterfly spread.  A trader profits from an iron butterfly spread when the underlying stock is stagnant or trades in a tight price range over the life of the spread. An iron butterfly spread is made up of four options trades […]

Delta Neutral Trading

Delta Neutral Trading

A delta neutral position is when two or more positions are used to establish a neutral market position.  A trader can apply a delta neutral position with stock and one or more options, OR two or more different options.  Whatever combination of securities used, the delta of the two securities offset each other so the […]