How to size one’s options trade is a subject that is certainly open to much debate. However, for traders looking to use options as an alternative to stock, you’re in luck. I have a simple way to think about how…
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Of course you want to know how “big” your option position is. After all, you’re looking to make a profit on your trades, right? However, how do you know just how “big” it actually is? A trader who owns 10…
A closed-end fund (CEF) is a fund whose shares can be bought and sold at any time during market hours. They differ from open-ended mutual funds in that they have a limited number of shares outstanding and generally do…
A lot has been said about the importance of staying invested over the long-term. Analysts and advisors routinely encourage investors to avoid getting caught up in the short-term volatility of the markets. They cite studies that show the high impact…
On December 31, 2015, the SPDR S&P 500 Trust ETF (SPY) closed at $203.87. Ten years earlier, on December 31, 2005, the SPY closed at $124.51. Price appreciation over this time-frame was 63% (5.00% annualized). An investor who held on…
Should you trade a cap-weighted or equal-weighted index ETF? What is a cap-weighted index ETF? In a capitalization-weighted index ETF the biggest companies receive the heaviest weightings. The S+P 500 is the most widely known and widely-used index. SPY is the…
Earnings season is a time of heightened uncertainty. This translates into higher options premiums. After the event, premiums return to more normal levels. In the chart below, the orange line, which tracks the history of implied volatility, shows us that…
In the aftermath of each of the most recent bear markets, we all heard talk about how folks would need to postpone retirement to rebuild their nest eggs. Consider the following: An investor in their 40’s has been investing religiously…
