We had an ice storm on the East Coast this week that knocked my Internet service off the grid and shut down electricity throughout the area, and so I wandered through the city whose infrastructure had failed me as snow and ice fell around me. From home to office to a soccer-mom-filled Starbucks, I finally made it to my daughter’s … Read More
How to Play Earnings with Options
Trading equities around an earnings report can be exciting, to say the least. To be successful you would need to project what the earnings results might be for a company and then you may need to determine how the markets might react to that earnings report. That is one unknown on top of another, and you basically need to be … Read More
Free Options Webinar: Craig Hilsenrath of Optionworkbench.com: Improving Options Portfolio Returns Using Probabilities and Statistics
Tuesday January 7, 2014 at 5pm ET Each Tuesday, SMB hosts an Options Tribe meeting where veteran traders and experts in the world of options trading share live presentations. This meeting is free to the public on the first Tuesday of each month. All other meetings require an annual membership to OptionsTribe.com. To register or join, please use the invitation … Read More
Unleashing the Power of an Options Trading Plan: Beyond Strategy
One common reason that options traders can’t find consistency is because they lack of a trading plan. You may be able to track your performance, but without an options trading plan it will be very difficult to repeat your success and minimize risk. A comprehensive options trading plan outlines how you will trade (your method), how much money you will … Read More
Understanding Call Option Dynamics When the Market Rises
When new traders first discover options trading they get excited by the leverage that buying options can provide. One call option contract allows you to control 100 shares of the underlying security. So instead of buying the stock on margin, you can buy an option using a lot less capital. This leverage attracts traders who have limited resources because under … Read More
Before Placing a Trade: Embracing Risk Management for Success
Today’s lesson is going to be a little about trading psychology and a little about money management. At the end of this post we have provided additional training videos to further enhance your skills. We are going discuss what risk is and how most traders view it from the wrong perspective. First, let’s cover a couple of definitions: Money management is how … Read More
Advantages of Trading Weekly Short Butterflies
Over the past several years, options trading has evolved along two basic directions. The first involves structuring trades that are designed to profit from a particular view of the market. In most cases these positions serve as a proxy for stock ownership: they allow an investor to be long or short in a specific time frame with a certain amount … Read More
Demystifying Options Contracts: Understanding Strike Prices
One of the basic concepts of trading options is the “strike price” of the option. For call options, the strike price is the price at which you have the right to buy the asset before expiration, and for put options the strike price represents the price at which you have the right to sell the asset at expiration. As the … Read More