Archive for July, 2009

Bearish Covered Calls on Short ETFs

Thursday, July 30th, 2009

The financial talking heads and pundits have been saying for some time now that the stock market is destined to take another nosedive in the near future. Time will tell whether their short-term predictions are correct or not, but the stock market is cyclical, so there will always be ups and downs, which causes [...]

Making Money with Covered Calls Even When the Stock Goes Down

Tuesday, July 28th, 2009

Investors in stocks naturally like it when stocks are on the upswing, but don’t like it when stocks are sliding downward.
One way to cushion the downside is with an in-the-money covered call investing strategy. Generally, investors consider covered calls as limited return on the upside with a lot of exposure to the downside. [...]

Making Monthly Cash Income with Covered Calls Options Investing

Monday, July 27th, 2009

Mention the term covered call investing strategy, and many investors picture limited upside potential, with the potential for making a small profit. These investors may also consider the real beneficiaries of the covered call investing strategy to be the sellers of the call options who benefit handsomely when the price of the stock increases [...]

California’s Debt & IOUs - What a Mess - How to Protect Your California Investments with Put Options

Thursday, July 23rd, 2009

The state of California is in financial distress. Unlike its municipalities, California cannot seek protection under the United States Bankruptcy Code (”Bankruptcy Code”). The state will have to address the crisis through a range of non-bankruptcy options. State issued IOUs will have to be paid. Contractors may be amenable to renegotiating their contracts. Perhaps the [...]

Economists’ predictions: Is the recession over?

Monday, July 20th, 2009

Although the recession began in December 2007, the first very public casualty came in September 2008, with the collapse of Lehman Brothers (LEH). Subsequently, between September 2008 and March 2009 the U.S. economy contracted by 5.5% and consumer prices plummeted by 12.4% in the final quarter of 2008. However, since the 1940s, recessions in the [...]

Implications of Google’s PC Operating System

Tuesday, July 14th, 2009

Mountain View, California-based Google Corporation (GOOG), best known for its white page search engine and recently its Chrome web browser, announced on Tuesday (07-08-09) that it is working on a PC operating system called ChromeOS. Google is currently aiming the OS at the relatively new netbook segment that is served mostly by Microsoft’s (MSFT) Windows [...]

Making Money in Neutral Markets with Stock Options and How to Calculate the Profits

Monday, July 13th, 2009

A method for making money in a neutral stock market is with the iron condor. An iron condor is a neutral stock options strategy and consists of a combination of a bull-put credit spreads and a bear-call credit spreads. A credit spreads trade is entered by selling stock options and simultaneously purchasing stock [...]

Steve Jobs Back at Work: Now what for Apple and Competitors?

Friday, July 10th, 2009

In late June 2009, Steve Jobs returned to work as Apple Inc.’s (AAPL) CEO. His return comes following a surprise five-month hiatus, which Jobs claimed he needed as the result of “complex” health issues. We now know he had a liver transplant at a Memphis hospital in April. Speculation about Jobs’s health and the future [...]

When is the best time to sell Covered Calls?

Monday, July 6th, 2009

In my experience, the best time to sell a covered call is really based on the performance of the stock. For example, I have a few low priced stocks that are trading around the $6.00 range. I cannot sell the 7.5 strike calls as there is little or no premium, and I do [...]

Home Construction is Rebounding: Time to Invest?

Monday, July 6th, 2009

In light of the slight upswing of the national economy, the housing market has begun to follow suit. According to the Commerce Department, construction of new homes has risen 17.2 percent in the last month, higher than the rate economists predicted following April’s record low. This, combined with the steady increase of building permits issued, [...]