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Risk and Reward: The Basics of Buying Stocks on Margin

Risk and Reward: The Basics of Buying Stocks on Margin

Although it’s been available in the brokerage industry for decades, buying stocks on margin ranks up there with short selling as one of the things many investors are most wary about trying. But once you learn the basics of margin—and understand its inherent risks— you might find it to be a valuable addition to add to your trading toolbox. Buying (or trading) on margin means ...

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Lower Margin Requirements with a Vertical Option Spread
January 31, 2018

Lower Margin Requirements with a Vertical Option Spread

Let’s say you have been selling naked puts, and the market has made an extended move higher in your favor. Chances are, you're getting a little nervous. Will the ...

Versatility, Flexibility: The Continuing Allure of Listed Options
January 19, 2018

Versatility, Flexibility: The Continuing Allure of Listed Options

In 2018, the exchange-traded equity options market will celebrate its 45th anniversary in the U.S. Though 2017 marked another year of historically low volatility, with ...

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Option Collar Options: Rolling Up, Rolling Down, Rolling Out ...
January 4, 2018

Option Collar Options: Rolling Up, Rolling Down, Rolling Out ...

A previous article explored how options collars can help protect long stock positions while allowing the stock to appreciate in price by a limited amount. We showed ...

Wearing a Collar? Here’s How and When You Might Adjust It
December 28, 2017

Wearing a Collar? Here’s How and When You Might Adjust It

The stock market has made a number of new highs. So protective puts and other option strategies designed to defend against downside moves may not be foremost ...

Turn a Long Butterfly Spread into a Credit Spread? Break a Wing
December 21, 2017

Turn a Long Butterfly Spread into a Credit Spread? Break a Wing

A butterfly spread is a common choice among options traders who anticipate a move in a stock toward a specific strike price, in hopes it will expire right at...

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Looking to Buy or Accumulate Stock? Consider Put Spreads
December 14, 2017

Looking to Buy or Accumulate Stock? Consider Put Spreads

Stock traders and investors often enter orders to buy shares at a price that’s lower than the prevailing price. But did you know that certain options strategies can ...

Derivatives With a Twist: Options on Futures vs. Equity Options
December 7, 2017

Derivatives With a Twist: Options on Futures vs. Equity Options

Tax audit. Crash. Emergency liquidation. Let's face it—some financial terms are scary, perhaps for good reason. But here's a term that may sound scarier than it is ...

Options and Calendar Spread Decision Time: Close It or Roll It?
November 30, 2017

Options and Calendar Spread Decision Time: Close It or Roll It?

So you’ve put on a calendar spread in XYZ by buying a deferred-month 50-strike call and selling a nearer-term 50-strike call. Fast-forward a few weeks. How did the...

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Tinsel and Trading: Options and Holiday Markets
November 30, 2017

Tinsel and Trading: Options and Holiday Markets

It’s late December, and you’ve taken the last two weeks of the year off. The kids are visiting friends, your spouse is out doing some shopping, and you’re home all alone ...

Options for Low Volatility: Setting Up and Rolling Calendars
November 16, 2017

Options for Low Volatility: Setting Up and Rolling Calendars

Option traders interested in premium collection strategies, those that profit from time decay, often turn to short strategies such as iron condors or short verticals...

Double Calendars: The Low Volatility Trade with Two Peaks
November 6, 2017

Double Calendars: The Low Volatility Trade with Two Peaks

If you’re looking for an option strategy that's designed for a lower-volatility environment where the underlying price action gravitates toward either of two different...

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Straddles and Strangles: Basic Volatility, Magnitude Strategies
October 31, 2017

Straddles and Strangles: Basic Volatility, Magnitude Strategies

“This could be the start of something big,” you say? Perhaps there’s an earnings report coming up in a stock you’re considering. Or maybe there’s a product launch ...

Your Options ABCs: Basic Call and Put Option Strategies
October 26, 2017

Your Options ABCs: Basic Call and Put Option Strategies

Before learning to run, you had to first crawl, then walk. Before penning that masterpiece, the writer needed to learn the ABCs. And before jumping into options ...

On Any Given Friday: An Introduction to Weekly Options
October 19, 2017

On Any Given Friday: An Introduction to Weekly Options

It used to be that option expiration occurred once a month, generally on the third Friday of the month. That all changed in 2005 when exchanges began listing options ...

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Confidence Boost: Tools to Help Hone Your Options Strategy
October 12, 2017

Confidence Boost: Tools to Help Hone Your Options Strategy

Are you new to options trading? Do you have a potential trade idea but you're not quite confident enough to pull the trigger? Since it may be unwise to put on a trade ...

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