Monthly Archives: March 2006

January Effect – Part 2

Historically, the month of January has shown abnormally high stock returns for stocks with small capitalizations. The effect is so large in fact that the return of a security in January may be the largest portion of its annual return. … Continue reading

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Company Stock Options & Tax Reduction

Generally, stock options issued to employees are either Nonqualified Stock Options (NSO) or Incentive Stock Options (ISO). Employees receiving NSOs or ISOs could possibly realize a tax reduction with stock insurance through buying put options.

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Portfolio Management: Stock Insurance

Most people have insurance for their house, car, etc., but what about for stock portfolio management? Yes, it is possible to buy stock insurance for a portfolio of stocks, but don’t call your insurance broker. Personal stock portfolios can be … Continue reading

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Stock Investment Diversification

So you’ve been told you should diversify your portfolio for stock investing, you’ve been told it makes for good stock portfolio management, but how can you know whether one of the potential stock investment strategies you’re considering is aiding you … Continue reading

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Stock Earnings Warnings

Earnings warning! Earnings warning! Earnings warning! Some (not all) public companies when determining they have or will have a shortfall in earnings compared to previously forecasted earnings may issue an earnings warning. The stock price for a company issuing an … Continue reading

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Strike of Pain Calculator

The Strike of Pain is the strike price with the lowest In-the-Money value for both calls and puts on a given stock for a given expiration date. This is the strike where the long option traders will lose the most … Continue reading

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OptionsXpo & BrokerLink

If you haven’t heard yet, we have upgraded our BrokerLink technology with optionsXpress. Now, PowerOptions users can easily and conveniently trade any stock option investment strategy they find with just a few clicks.

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Stock Option Trading Probability

You might ask, “what does probability have to do with option investing?”, and the answer is “a lot”. The probability of having a safe flight on an airline is better than 99.99999%, and the probability of a safe automobile trip … Continue reading

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Option Trading: The Greeks

To be a successful option trader, an investor naturally has to pay attention to the prices of options. It is not enough to merely watch the option prices, selling when the price is up and buying when the price is … Continue reading

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Back Testing and Dollar Cost Averaging

OK, so you notice a statement regarding a potential investment that says, “our strategy has been back tested”, and wonder what does that mean. Very simply, back testing is using historical data to determine the results of an investment strategy … Continue reading

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