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ntrader
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Everything posted by ntrader
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This will be a very interestig week as big names such as Johnson and Johnson (JNJ), Apple (AAPL), IBM (IBM), McDonald's (MCD) Google (GOOG) reporting quarterly earnings.
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Most of the times I prefer to open a bull call spread rather than writing a covered call for the same profit using less capital. Instead of buying the underlying stock in the covered call strategy, in the bull call spread strategy I have to buy deep-in-the-money call options. It is better for me to sell near-month options as time decay is at its greatest for these options. So the two strategies that I am comparing will involve selling near-month slightly out-of-the-money call options. For example let’s say that the stock ABC currently trading at $100 in June and the July 110 call is priced at $4 while a July 90 call is priced at $11.50. If you enter into a covered call write you have to buy 100 shares of ABC at $100 each and sell a July 110 call. The initial investment is $10000 (long stock) - $400 (short call) = $9600. If you enter a bull call spread you can buy the July 90 call while selling the July 110 call. The initial investment in this case is $1150 (long call) - $400 (short call) = $750. Profit/loss at various ABC stock price on expiration date. Strategy Initial Investment Stock Price on Expiration Below $90 $90 $100 $110 & Above Bull Call Spread 750 -750 -750 250 1250 Covered Call 9600 Unlimited -300 200 1400 The maximum potential profit for the bull call spread is only $150 below than the covered call but the covered call has a potentially unlimited downside risk (all the initial investment $9600 in potential losses). So the bull call spread is a superior strategy to the covered call if you are willing to sacrifice some profits in return for higher leverage and significantly greater downside risk.
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Hi TheDarkhorse, I prefer day trading in forex and usually in stocks i open a position for the next two or three days. I think demo trading for six months is enough time to make you feel comfortable with trading and start trading with your real money, keep in mind that is always different trading with demo and with real money. Be carefull, do your homework. Best Regards
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Hello tiandao! welcome to our community
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Risky assets in general are near decade highs and multi-year resistance, so in the absence of some new fundamental bullish catalyst like a very positive earnings season, there may be strong temptations to take profits
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Important Reminder for all traders: The VIX is at its lowest level since June 2007 at 13.36
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What are the factors that drive Forex prices in the long term?
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In today's globalized world you have to follow all the major markets in order to make the right decision, for example, a decision from ECB about interest rates wiil have an impact in currencies in european stocks and also to a large number of US stocks, the debate about fiscal cliff is affecting all the markets and the commodities, etc.
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Please Help Me to Select a Stock for Daytrading
ntrader replied to anituchka's topic in Day Trading and Scalping
AAPL will continue with high volatility for the next two months so i think you can make some intraday profits. You can check also HLF, FB and RIMM but you have to be very carefull with your trades the risk is very high. -
I believe gold will move up as the european debt crisis is far from over and significant economic and policy uncertainty coming from the fiscal cliff debate in the US will drive the "conservative" money in to the safe heaven metal.
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Hi BlueHorseshoe, I have just started a new thread aboyt the advantages and disadvantages of stock options i think it will help you check: http://www.traderslaboratory.com/forums/options-trading-laboratory/15289-advantages-disadvantages-stock-options-trading.html
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This thread is for those wishing to discuss the advantages and disadvantages of stock options trading. I am waiting your thoughts.. One positive for stock options trading I believe is leverage, with options you can achieve a greater amount of leverage than when purchasing the underlying stock.
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I can recommend you the: Futures, Options and Swaps by Robert Kolb and James Overdahl. It provides an excellent balance between introductory and advanced topics and all the latest developments in the markets.
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Profit taking from yesterday's gains ($1678) after the ECB decision You are right about the safe haven but I am trader and not a long term investor, so $40 is a good return for me, and as you you said markets don’t do what most expect so I prefer to lock in my gains
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The war have just started so I have open a new trade for HLF: Long on February call with a strike of 45 priced at $1.60 per contract and long on February put with a strike of 35 priced at $1.90. Net Debit: $3.5 Max Loss: $3.5
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Profit taking from yesterday's gains ($1678) after the ECB decision You are right about the safe haven but I am trader and not a long term investor, so $40 is a good return for me, and as you you said markets don’t do what most expect so I prefer to lock in my gains.
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I am still bullish on gold and I believe every pullback is a buying opportunity. Today’s drop below $1670, due to profit taking and Chinese inflation data, gives me a buy signal, I am adding gold to my portfolio below $1680 with a target price of $1726. The major safe haven asset for investors is still gold.
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I am not very optimistic about 2013, after January and as the VIX is at 5 year lows i am expecting a market correction, Vix can not stay at these level for a long time.
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I am full time trader and i have ten years experience trading stocks, options futures and forex. Now i am trading from home using technical analysis and macro news.