Category Archives: Stock Option Trading News

Your Own Personalized Investment Newsletter with Personalized Investment Ideas by Email

The tools at PowerOptions are used by self-directed investors to develop a set of screening parameters that find stock and option combinations which meet your specific investment criteria and risk/reward tolerance. Once your personalized search criteria are developed and tested, the search can be implemented and applied anytime to produce your results – just logon anytime to see your search results.

If getting logged into the site for your results is ever inconvenient, we also offer your search results by email. Just like a newsletter service, your investment idea results are sent to your e-mail INBOX every day as your personal opportunity list.

Note: If you like the results you see from the PowerOptions built-in default search criteria, you can get those results by email as well.

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Conversions Are A Riskless Options Trade

option conversionConversions, if you are able to receive a credit, are no risk options trades with a very limited reward.

One example of a conversion is:

Buy shares of SLV @ $18.73
Sell JUN 18 call @ -$ 1.08
Buy JUN 18 put @    $ 0.34

Net Debit =         $17.99
Guaranteed exit/assignment = $18.00
Guaranteed Profit =          $ 0.01

1.  Possibility for a no-risk trade
2.  Credit is received
3.  Management is not necessary
4.  Opportunities can easily be found with PowerOptions

1.  Guaranteed Profit is extremely limited
2.  After commissions limited profit might turn into a loss
3.  Due to low profit, 1,000s of shares may need to be traded which hinders the retail investor
4.  Opportunities may appear, then disappear quickly.  I found this trade on PowerOptions, but by the time I linked to the profit and loss chart the trade showed a guaranteed loss of -$0.04 due to price changes in under a minute.

Nuts and Bolts of Option Trading Tools

Option investing can often be like “finding a needle in a haystack” – an investor knows there are good option trades out there, but finding them amongst the gazillion other “not-so-hot” option trades can be very difficult.  That why over the last ten years or so PowerOptions has been developing tools to help option traders find “needles in the haystack” with less effort and with less time required.

In addition to developing option trading technology, PowerOptions has also been actively patenting its option investment related technology.  PowerOptions’ latest issued patent may be viewed at this link.

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Successful Bullish Investing – Even in Short-Term Bearish Markets

It’s easy to generate positive returns when investing in bullish markets, but quite difficult to generate positive returns when attempting bullish investing in short-term bearish markets. However, it is possible to generate positive returns when using bullish investments in short-term bearish markets. And, an actual profitable example will be given below explaining the concept.

See what the stock option experts are doing
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Apple: Time to Do Away with Thermonuclear

Apple (AAPL) is currently at the center of a large number of mobile patent lawsuits. The company is not merely intent on licensing its technology as International Business Machines (IBM), Microsoft (MSFT) and others. No, Apple seeks to go “thermonuclear” as Steve Jobs has been quoted as saying with the hopes of fending off competitors in court rather in the market place. Albert Einstein is quoted as saying, “I know not with what weapons World War III will be fought, but World War IV will be fought with sticks and stones.” In light of Einstein’s quote, maybe Apple should reconsider its thermonuclear posture, especially, considering the company ranked 39th on the list of companies awarded patents in 2011. No surprise, on top of the patent pile for 2011 was once again IBM, followed by Samsung and Microsoft. Before a company goes thermonuclear, it should at least have the best quiver of arrows. Maybe Apple thinks it has the “biggest arrow” that trumps all others.

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Memorial Day and Remembering

It’s good to take time to remember those who were in the military and have performed the ultimate sacrifice. I was never in the military, and at my age the military wouldn’t even take me, but I really respect those who serve, have served and those who have sacrificed in the military.

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Memorial Day is a reminder every year of how bad my memory is. Outside of car keys, wallet and cell phone, I can scarcely remember where anything else is. For example, I have no idea where my staple gun and funnels are located.

When it comes to investing, my memory is just as bad as it is with my staple gun and funnels, can’t remember the trades I’ve made or the reason(s) for the trades, which is why I use PowerOptions tools to do my remembering for me.
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4 Ways to Insure Your Investment Portfolios

Conventional Approach

The conventional approach for protecting a portfolio against a large loss, research, buy-and-hold and diversification works well for singular events like an Enron or a Worldcom. However, for systematic market problems this approach can be very painful, as the stock market can drop significantly with very few stocks maintaining their value.

The stock market can behave crazily at times as in the case of Technology Bubble, Lehman Brothers, Housing Bubble, Credit Crisis, Debt Ceiling, etc. Investors can be taken for very painful rides during market events such as these.

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(to view archived version of this presentation click the video below)

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Beating the Market with Blue Chips on the Dips and Stock Options

By blue chips and dips, we’re not talking about those fancy blue corn tortilla chips with salsa, no we’re talking about Covered Call positions for stocks of blue chip companies or very large companies.

Most Well Known Stock Option Strategy

The Covered Call strategy is the most well known stock option investing strategy. The Covered Call strategy is easy to implement and is less risky than many other stock option strategies. Entering a Covered Call position entails purchasing a stock and selling a call option against the purchased stock. The Covered Call position can return a higher return than experienced by the plain-old long stock position, and the converse is also true, the long stock position can return a higher return than the Covered Call position. A typical potential return for a Covered Call position is around 2-3% over a timeframe of one month.
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PowerOptions Open Discussion 3/25/2011

During this open discussion presentation, Mike Chupka, PowerOptions Director of Education handles questions from customers such as:

1. “What is the expected monthly return for covered calls, vertical spreads, diagonal spreads and the RadioActive Trading Techniques?”

a. This leads to a conversation at the 30 minute mark: “One of your competitors claims they make monthly returns of 3-6% for covered calls; 6-10% for diagonal spreads and higher for vertical spreads…”

(To view the video, select below)

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Introduction to PowerOptions Long Call and Long Put Focus

This presentation focuses on using the PowerOptions Search tool to identify Long Calls and Long Puts, comments on analyzing a Long Call or Long Put with the Research and Analysis links, using the ‘Optimized Long Option Finder’ (only found on PowerOptions) to evaluate which Long Call or Long Put might give you the best ‘bang’ for your buck, as well as tracking the positions and the PowerOptions Portfolio tools and evaluating potential Roll Out Opportunities or Adjustments using the Position Analysis Screen and Simulate Trade feature.

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