Posts Tagged ‘stock market’

 

5 Tips For Buying Penny Stocks

Friday, August 6th, 2010

Investing in penny shares gives traders using the possibility to dramatically boost their income, however, it also offers an equal chance to shed your dealing funds rapidly. These five ideas will allow you to lower the danger of one of several riskiest purchase automobiles.

one. Penny Stocks and shares are a penny for any reason.
While we all dream about spending in the next Microsoft or the subsequent House Depot, the truth is, the odds of you discovering that when in a decade achievement story are slim. These companies are either commencing out and bought a shell business simply because it was less costly than an IPO, or they basically usually do not use a company program compelling sufficient to justify investment banker’s funds for an IPO. This does not make them a poor investment, but it should make you be realistic in regards to the type of organization which you are purchasing.

a couple of. Trading Volumes
Look for a consistent high quantity of shares being traded. Seeking at the common quantity could be misleading. If ABC trades 1 million shares these days, and doesn’t trade for that rest with the week, the every day typical will appear being 200 000 shares. In order to get in and out at an acceptable rate of return, you need constant amount. Also look at the number of trades per day. Is it 1 insider selling or buying? Liquidity should be the very first thing to look at. If there’s no amount, you may wind up holding “dead money”, exactly where the only way of promoting shares is to dump at the bid, which will place much more marketing pressure, resulting in an even reduce sell cost.

three. Does the company know how to make a profit?
While its not unusual to see a commence up organization run at a reduction, its important to take a look at why they’re losing funds. Is it manageable? Will they have to find further financing (resulting in dilution of one’s shares) or will they’ve to find a joint partnership that favors the other company?

If your company knows how to create a profit, the business can use that cash to grow their enterprise, which increases shareholder value. You’ve to accomplish some research to discover these companies, but whenever you do, you reduced the chance of your loss of the capital, and increase the odds of the a lot higher return.

4. Have an entry and exit program - and stick to it.
Penny stocks and shares are volitile. They are going to rapidly move up, and move down just as rapidly. Remember, if you acquire a inventory at $0.10 and promote it at $0.12, that represents a 20% return on your investment. A a couple of cent decline leaves you with a 20% reduction. Many stocks buy and sell in this range on a daily basis. If your expense cash is $10 000, a 20% loss is a $2000 reduction. Do this 5 times and you’re out of money. Retain your stops close. Should you get stopped out, move on for the following possibility. The market is telling you something, and whether you desire to admit it or not, its generally greatest to listen.

If your program was to promote at $0.12 and it jumps to $0.13, either take the 30% gain, or much better still, place your stop at $0.12. Lock inside your income although not capping the upside possible.

5. How did you discover out about the stock?
Most people discover out about penny stocks and shares through a mailing list. You can find numerous exceptional penny store newsletters, nonetheless, there are just as numerous who are pumping and dumping. They, in addition to insiders, will load up on shares, then start to pump the organization to unsuspecting newsletter subscribers. These subscribers purchase while insiders are marketing. Guess who wins right here.

Not all newsletters are negative. Having worked within the industry for that last 8 years, I have seen my share of unscrupulous firms and promoters. Some are paid in shares, sometimes in restricted shares (an agreement whereby the shares can’t be sold for any predetermined period of time), others in cash.

Tips on how to spot the excellent businesses through the bad? Merely subscribe, and track the investments. Was there a legitimate possibility to produce cash? Do they have a track record of providing subscribers with excellent opportunities?  You’ll begin to notice quickly if you have subscribed to a good newsletter or not.

1 other tip I would provide to you just isn’t to invest a lot more than 20% of the overall portfolio in penny shares. You’re investing to create cash and preserve funds to fight an additional battle. Should you place as well much of one’s cash at chance, you improve the odds of losing your cash. If that 20% grows, you will have more than adequate money to make a healthy rate of return. Penny stocks and shares are risky to commence with, why put your cash much more at danger?

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9 Survival Tips For The Marketplace Shakeout Blues

Friday, August 6th, 2010

Investors who bought during the leading of the frothy commodities rally are now panicking or kicking themselves. Neither activity aids an trader or trader consider straight. Beneath are a handful of suggestions in dealing while using existing industry shakeout.

1. If you feel you invested within the correct investment(s), then turn off your pc and do something enjoyable. Exercise can be a excellent tension reliever. The marketplace has already begun its shakeout. Should you didn’t get stopped out, or failed to place earlier stops, your greatest opportunity lays ahead in choosing up extra shares at a much lower price. Most of the experts we’ve interviewed tell us the subsequent rally ought to begin sometime among late July and Labor Day. In an attempt to interview the uranium guru James Dines in late May, we have been told, “Call back in the couple of months.” That was a useful clue that the markets had been less than exciting. Mr. Dines is frequently eager being interviewed, but recently he was not.

2. Do you feel the fundamentals which engendered the commodities boom have altered? If they haven’t, then the bullishness is only taking a breather. We do not see any fundamental change inside the markets. Russia nevertheless wants nuclear power, and its oil production may possibly be peaking. China hasn’t announced the finish of its nuclear expansion program. India would like to invest $40 billion on new nuclear reactors. If you’re invested in uranium stocks, spot uranium jumped an additional dollar to $45/pound this past week. Hardly the end with the bull marketplace.

3. If you worry about your expense in 1 investment or another, then stop watching the ticker and focus on the organization fundamentals. Is the story even now accurate or has it changed? See #7 A, B and C under.

4. There’s an old cliché that the time to purchase is when you experience like dumping everything you own inside the category. At the exact moment you want to market your entire portfolio of uranium shares, it might be wiser to add for your holdings. This applies mainly for the retail investor. Most of the professionals did dump at the leading and are now slowly accumulating the shares with the naïve who waited until the washout to start selling off.

5. Has a major, earth-shattering event occurred? The last bull cycle in uranium ended with Three Mile Island (TMI) The last decent rally within the precious metals markets fell off a cliff after it was discovered Bre-X Minerals had perpetrated a fraud about its gold ‘discovery’ in Indonesia. Something substantial and newsworthy always transpires, and it’s also far-reaching. That’s the trigger. As with TMI and Bre-X, individuals were the first shots which launched a later chain reaction to end people bull markets.

6. Before pulling the market trigger, ask yourself: Do I actually wish to give up these shares to a bargain basement hunter, who will make a killing on my losses?

7. Since most of you’ll nevertheless panic, please review the following basics for any of the uranium companies you’ve read about:

A) How very much money does the business have in the bank? Throughout shakeouts, hard cash is king. Prescient companies, which completed their financings throughout the latest and robust rally, are sitting pretty. They can weather the short-term storm and are well-oiled to move forward when this correction bottoms and reverses. People companies are the strongest ones to check out when this correction looks gloomiest.

B) Has the management remained the exact same? Unless the leading monetary and/or technical individuals blew out the door, in current weeks, the story most likely hasn’t changed a lot. Firms which built a strong technical team are resilient and powerful. They will move forward.

C) Have the properties appear up dry? 1 of the reasons you invested inside a uranium company was because it introduced it had “pounds within the ground.” Some companies have much more than others. Some went for the expense and trouble of completing a National Instrument 43-101, which independently confirmed the quantity and high quality from the uranium resource. If that changed – and the business announced, “Sorry, nothing there right after all,” or introduced, “Hey, we were kidding,” that is one factor. If you haven’t heard that, or study a news release announcing that, then the uranium didn’t walk away or move onto a competitor’s property. It’s nevertheless there.

Following time, when the markets are racing higher, and you feel like you won the lottery, think about this bit of biblical advice. The old joke goes, “When did Noah build his ark?” The answer obviously is: Before it began to rain.

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Report On Share Investigation

Tuesday, July 27th, 2010

 

The report of share investigation contains every one of the details like the fair worth estimate of the company’s well worth. Likewise, guides on when to purchase and when to promote stocks and shares as properly because the promoting costs of stocks and shares are also discussed and displayed about the stock investigation record.

 

A stock investigation statement is accomplished by professional analysts who are renowned in their own businesses and their industries. Their reports mainly cover strengths and weaknesses, lines of enterprise, what’s great and poor about recent share investment decisions as nicely as some projections of what to expect from a business in terms of its monetary health.

 

The investment study statement also tells you whether or not a business is well worth purchasing or marketing and just when to purchase and sell stocks and shares from this organization. Knowing this kind of information can assist you in earning back again a great deal of earnings out of your share purchase.

 

In addition, the significance of such reviews cannot be taken for granted, specifically in a globe exactly where the market is unstable, wherein in the blink of an eye you may lose everything you might have invested. Share study reviews keep you up-to-date with the latest and timely developments happening in the investment industry. Stock reports are just one of the services offered by most on the web stock investigation services.

 

Once you sign up or joined an on the web investment research provider you were offered with share alerts concerning new analyst records plus some daily commentaries. Aside from that, you may also take pleasure in the privilege of having daily dose of expert opinion about businesses they cover inside the news. They also have portfolio alerts that tell you when your portfolio is underperforming or outperforming.

 

Having a investment research record you may always be guided on what course of actions to carry specifically in case you cannot monitor your portfolio regularly. Keep in mind that the investment expense needs for keen monitoring or else you’ll discover yourself dropping funds as opposed to gaining again a lot more income.

 

Nevertheless, the investment research record isn’t a free service, most companies of these kinds of reviews only offer you free-day trials for new members but afterwards would require for a monthly or annual subscription fee.

 

Be certain to properly select the investment research service provider; opt for those people highly regarded providers that already have names within the stock expense marketplace. Don’t be fooled by those investment research services claiming that they have the greatest share purchase solutions and promises you very high rate of purchase returns. These promises frequently times just remain to become a promise that will by no means be realized because the provider that you simply have chosen is actually not that knowledgeable in investment expense.

 

Look for individuals providers that possess credible portfolios and to be really certain you may possibly try to confirm by researching further the authenticity of their claims. You may also try to ask your friends, colleagues and family whether or not they’re familiar while using service provider you might be investigating. Even better nevertheless, ask folks within the share marketplace if they are familiar while using supplier you might be inquiring about. If it’s really true that they are a reputable investment research supplier, then their reputation will echo the sentiment.

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Retail Is For Stockpickers

Tuesday, July 27th, 2010

 

Since September 2004, the S&P Retail Index has been caught inside a sideways consolidation channel at between 400 and 500, unable to establish a sustainable trend in a single direction or the other. Throughout that time, the monthly retail numbers are already largely mixed. But in January, the retail data (excluding auto) was impressive, showing growth of 2.20% versus the estimate of 0.8%. It was the strongest reading in years.

 

Yet the initial optimism appears being fading right after seeing mixed reports from the nation’s retailers on Thursday. The early data suggests that same-store sales growth will be sub par compared to what we saw in January.

 

The reading in January might happen to be an aberration since of warmer than expected temperatures. The surfacing of cold weather in February apparently sent a chill through the pocketbooks of consumers. Also, the strong January sales may possibly have taken away from spending in February.

 

The reality may be the absence of your positive trend in retail makes committing in retail shares more of the chance. You must pick the proper organization. Even bellwether stocks for instance Wal-Mart Stores (WMT) are struggling as far as its share cost in spite of some decent sales outcomes and same-store sales growth. However the current valuation deserves a look.

 

Youth oriented clothes retailer Gap (GPS) is a business that’s clearly struggling at the money register. Its February same-store sales crashed 11% year-over-year, nicely above the Street estimate calling for a decline of 6.80%. This followed about the heels of an 11% decline in the company’s Q4 earnings along having a FY07 forecast that was short of Wall Street expectations.

 

GAP expects comparable-store sales to become negative inside the very first half and turn moderately positive for the remainder with the year. Same-store sales are widely viewed because the finest indicator of your retailer’s health.

 

For investors, GAP is clearly a turnaround play that could spend off if it can somehow figure out the best way to attract shoppers. The fact could be the organization has excellent brand awareness and this counts for some thing in this brand conscious globe we live in.

 

On the upside, you might have a business like Greatest Purchase (BBY), a dominant marketplace leader in consumer electronics. The investment is just below its 52-week high, up 69% from its yearly low.

 

The reality is retail spending might be impacted by the higher financing costs associated while using rising debt loads across America. The personal savings rate is declining and was negative in January. Consumers are eating into their savings and you realize this can’t be good for retail.

 

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Benefiting From Share Exchanging

Wednesday, July 7th, 2010

Numerous persons say that to get effective in share investing, by far the most crucial thing that you ought to understand is you capability to survive in this dog-eat-dog-world sector. This indicates that understanding what you genuinely want and getting prepared to face all the problems and difficulties that occur along using the marketplace.

Currently, the number of folks who engage in store dealing continues to increase for your easy explanation how the money investment could flourish in no time. But because stock buying and selling is enterprise itself, it takes a sensible “businessman,” so to speak, to produce it perform. That “businessman” is the commodity investor him or herself.

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Starting small in stock trading

The commodity marketplace or share buying and selling is considered as one particular from the most practical sources of revenue there is. When compared with other industries, share buying and selling can make a individual or a trader a millionaire for just a single complete evening transacting. This is because investment investing is regarded since the greatest income-generating industries within the whole globe. Here, multi-billion dealings are being held each minute, each hour, every single evening, and every week.

Share trading is believed for being the most successful industries one particular can get into for as extended as he or she has the skills, the expertise, the power, the enthusiasm, and the drive to push forward. Even though there other industries that may present the exact same amount of revenue which can be generated from store trading, it’s quite incomparable in terms in the positive aspects that this sector brings. Should you are fit to indulge in share buying and selling but obtaining doubts on it, take into account the following positive aspects:

How can you benefit from it?

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The key advantage of acquiring into share dealing will be the flexibility of its enterprise schedule. That is the greatest benefit just one can get from share buying and selling. Considering that the industry runs 24/7, you’ll be able to generate your personal trade on schedule at your chose pace and time. While choosing a particular trading hour/s will not perform every single time, it can be still beneficial since the flexibility of routine can give the investor enough time to prepare and contemplate on points that needed to get paid attention to. In reality, more and additional individuals are enjoying this variety of setup because they are able to conduct organization anytime they want to and can make and close dealings with no having to be concerned about bases and operations. Because of the flexibility from the schedule, a investor can transact as a lot of businesses as he or she wants to because traders occur it and out every one of the time.

Next could well be the absence or reasonably low charges of transactions. A different key reason why individuals are jumping into the bandwagon of investment buying and selling is because there may be relatively low cost of transaction or sometimes, there’s really none at all. In stock buying and selling, the only thing that desires charging would be the services of brokers or commissioners. But when you can do the perform on your own personal, then you won’t need to worry paying somebody for your lobbying at the marketplace.

Lastly, the availability of wide array of investing vehicles can also be a main benefit a single could get. That is also yet another wonderful feature of investment dealing as it gives folks possibilities in carrying out their dealings. In commodity trading, dealings can come in numerous forms, which can suit the require from the trader or broker.

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How To Buy Top Stocks

Saturday, March 6th, 2010

Although it may seem obvious to most stock market swing traders there are a number of simple rules that you can follow which will ensure that you have more success when buying stocks:

In the USA stock market there are 3 major indexes which are each made up of a basket of stocks, they are the S and P 500 (also known as the S&P500), the DOW 30 and the Nadaq 100. These stock indexes generally only contain major blue chip stocks, as long as you buy from these 3 groups you will at least know that you are getting a well known solid stock.

For example the DOW 30 contains major industrials and large multinational stocks such as Home Depot (HD) and Johnson and Johnson (JNJ) whereas the Nasdaq 100 mainly contains techical companies such as Apple (AAPL) and Miscrosoft (MSFT).

Always buy a stock that is liquid, this means that it is a highly traded stock, this will enable you to quickly buy and sell at the price you want without having a delay. You will also get a smaller spread, thats the difference between the BID and ASK price of the stock. For a stock to be considered very liquid it should trade at least 500,000 shares per day, ideally even more.

It is best to avoid stocks that are bellow $10 as this usually means the company is in trouble, although with the bear market of 2008 there have been a lot of good stocks at bargin prices between $5 and $10. Avoid buying a stock that is below $5 at anytime.

Another consideration is options, does the stock has options?, this will be important if you want to trade options around your stock, such as a covered call, or you may want to buy a PUT option in order to protect your stock.

Be very cautious about buying a stock just before it’s earnings release, stocks often drop significantly if you come out with a poor report. Earnings are released 4 times a year with one of them being the annual report.

If you are going to trade options make sure that you learn how to trade by getting some good education. There are many swing trading strategies that work well with stocks in todays volatile markets.

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Technical Analysis For Stock Traders

Thursday, October 8th, 2009

Technical analysis of the stock market, or any other market such as Forex, futures, is how most traders and investors make their trading decisions. This is as opposed to fundamental analysis which most people more agree is pretty much done as a way of making trading decisions, unless of course you are Warren Buffet!.

You only have to think back to major stock market scams like Enron to know that it is almost impossible for the average, and even very sophisticated fund manager or hedge fund trader to really know what the real financial state of a company is.

Just by reading the balance sheet and other quaterly reports they release gives you a very poor insight into the real health of the company. Whereas the technical charts of the company tend to give the real picture of what the market thinks of the value of the company. In the case of Enron even simple technical analysis told you to SELL when the stock was in the $80-90 range, this is why technical analysis of stocks is so popular.

So what is the secret to technical analysis?, I’m about to tell you, here are my golden rules:

* Only use 3-5 simple technical analysis indicators

* Make sure that you understand how the indicators that you have selected work, what the parameter settings are and in what market conditions they are effective

* After selecting your indicators and parameter settings don’t mess with them.

The real secret to technical analysis is to get VERY familiar with your choosen indicators, and really this can only be done by watching and studying the market, so that you get to the point that you TRUST them.

The fact is that in any market, for each bar, there are only 5 pieces of information, the open, close, high, low and volume, yet there are now hundreds of indicators. Most of these indicators are displaying the same information and so are redundant.

For the record my set of indicators are:

* 4 Simple Moving Averages

* Bollinger Bands

* MACD

* Stochastics

But the way I use them is quite special, to learn more about how to become an expert at technical analysis visit:

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How To Buy Top Stocks

Friday, September 25th, 2009

Although it may seem obvious to most stock market swing traders there are a number of simple rules that you can follow which will ensure that you have more success when buying stocks:

In the USA stock market there are 3 major indexes which are each made up of a basket of stocks, they are the S and P 500 (also known as the S&P500), the DOW 30 and the Nadaq 100. These stock indexes generally only contain major blue chip stocks, as long as you buy from these 3 groups you will at least know that you are getting a well known solid stock.

For example the DOW30 contains major industrials and large multinational stocks such as Home Depot (HD) and Johnson and Johnson (JNJ) whereas the Nasdaq 100 contains almost all technical companies such as Apple (AAPL) and Miscrosoft (MSFT).

Always buy a stock that is liquid, this means that it is a highly traded stock, this will enable you to quickly buy and sell at the price you want without having a delay. You will also get a smaller spread, thats the difference between the BID and ASK price of the stock. For a stock to be considered highly liquid it should trade at least 500,000 shares per day, ideally even more.

It is best to aviod stocks that are bellow $10 as this usually means the company is in trouble, although with the bear market of 2008/9 there have been a lot of good stocks at bargin prices between $5 and $10. Avoid buying a stock that is below $5 at anytime.

Another consideration to make is options, does the stock has options?, this will be important if you want to trade options around your stock, such as a covered call, or you may want to buy a PUT option inorder to protect your stock.

Be very cautious about buying a stock just before it’s earnings are released, stocks often drop significantly if they come out with a poor report. Earnings are released 4 times a year with one of them being the annual report.

If you are going to trade options make sure that you learn how to trade by getting some good education. There are many swing trading strategies that work well with stocks in todays volatile markets.

 

 

Trading The Futures Market - What You need To Know

Wednesday, September 23rd, 2009

Contracts in the futures market are between a buyer and seller. The contract states that the seller must provide the buyer a very specific quantity of a certain item, such as cotton, oil etc, for a price agreed today, but at a date in the future.

It is important not to get confused about what the word future refers to. Futures traders are not day trading futures prices, we are trading today’s prices, but the settlement is taking place in the future. So we buy if we think prices will increase and we sell if we think prices will drop.

If I buy (or sell) a futures contract today, I don’t have to hold it until the contract expires, I can simply choose to sell it (or buy it) in the market at the prevailing price. Futures contracts are bought and sold in the controlled environment of a futures exchange, such as the Chicago Board of Trade (CBOT) in the U.S. and the London International Futures and Options Exchange (LIFFE) in the U.K.

Futures were originally developed to help offset the risks and uncertainties experienced by farmers and merchants due to the fluctuating supply and demand for produce. Take for example a coffee plantation farmer. The price that he will receive for his beans will vary according to the vagaries of supply and demand. In a year when supplies are limited and demand is high, prices will be high. In a year when demand falls and the supply is plentiful, the price will fall.

The use of futures trading in the farming industry has many benefits such as allowing the farmer to be able to plan ahead as he already knows what kind of profit he can expect from his crop of say coffee beans. The price may not be the best and the merchant may make a killing but the risk is reduced.

By using a form of futures contract long before harvest time both the farmer and the merchant can reduce their risks by setting the price.

Today the futures market has changed a lot from the historical origins. There are now futures contracts on financial instruments such as stocks and bonds. broadly speaking futures contracts are either commodity type products or financial type products. It is usually not very important because they are rarely held until expiration.

The CBOT was started in 1848 for the benefit of the farmers and merchants. The exchange was to regulate both the quality and quantity of the actual crop that was being traded. Today the CBOT offers many contracts on items like wheat, silver, corn, bonds and soybeans.

The Chicago Mercantile Exchange (CME) was created in 1919 and has managed a futures market in such things as pork bellies, live cattle and the SP500 index.

In London the big financial futures exchange is the London International Futures and Options Exchange (LIFFE). Here financial instruments such as the FTSE100, the GILT and Short Sterling are traded, the exchange is relativily new and opened around 1982.

EUREX started it’s life as the DTB, the German futures exchange. The DTB has always been an electronic exchange and started around 1990, when electronic exchanges were still considered to be inferior to the open outcry system.

The German Bund was a very heavily traded financial contract and one of the biggest markets on the LIFFE.

Many markets in futures have very high volumes and hence very good liquidity, these are attractive markets for traders. The high leverage means that profits can be made very fast when the market moves, however money can also be lost very fast. If you want to learn to trade futures, or are even thinking of trading futures make sure that you learn as much as you can before using real money.

 

Protect Your Stocks Using Put Options

Friday, September 18th, 2009

Hoping and praying that the stocks that you just bought will go up is not the best strategy to use, however it is the one very often used by the average Joe stock trader who is stock trading internet. The only good point they have is that in bull markets most stocks will go up.

Statistics show that in a bull market about 75% of the stocks will follow the general trend and go up, and in a bear market 75% will also go down. Trading with the trend is the best way to trade as 8 or 9 out of 12 stocks will follow the trend and give you the best chance of making gains on your stock purchases.

But what if you own some good stocks and don’t want to sell when the market is clearly going down, or about to go down?. There are a couple of tactics that you can consider, both of which involve the use of options, CALL options and PUT options. There is the widely known strategy called Covered Calls, and the much lesser known one called the Married Put.

If you are going to trade options it is essential that before you start trading you get the best option trading education that you can. You should also practice stock trading until you are comfortable with the process. This is a very important point that must be taken seriously, if you don’t understand the terminology and the theory then you should not be trading options. If the terms Put option, Call option, Married Put and Covered Call are new to you then don’t trade until you have studied sufficiently.

Selling calls against your stock in 100 share increments is the basis of the covered call strategy and it can provide about a 2-7% buffer against the loss in stock price. However a bigger drop in stock price will not be compensated for using the covered call strategy, in general.

Stocks in a bear market, and even in a bull market, can drop quickly on news or earnings releases, as much as 15 to 40% within a month. Using covered calls to protect your stocks will only provide limited protection of less than 7% at best and so will not save your account if the stock takes a 40% tumble.

The better solution to providing down-side stock protection is the option strategy called the Married Put. As the name suggests the PUT that you buy is used to provide protection when the stock goes down because Put options increase in value when the stock decreases in value. The term married is used because the option that is selected has to be very compatible with the stock, in other words a good match, if the strategy is to work.

The selection of the best Put option is not straight forward and involves several criteria which are listed below:

1. The strike price of the option

2. The current stock price

3. Choice of options, in or out of the money

4. Put expiration time

Even though the married Put protection only has a limited life span if offers much more protection than the covered call. It can provide as much as 95% loss recovery in the event of a significant drop in the stock price.

The downside of the good protection is that you have buy the Put which is a debit whereas the covered call is a credit. But there are ways of offsetting this expense and there is much more to this strategy when executed correctly. The Married Put can be made to pay for itself and used to generate very good gains if the market, or stock to be specific, moves a lot.

The general idea of the Collar Trade is to combine the covered call and married Put strategy into one, this is what is called the Collar Trade. In effect you put a collar around the stock, sell a call and buy a PUT. If you do this correctly most of the cost of the Put can be offset by the credit from the covered call so you can protect your valuable stock at almost no cost. Yes this is a great strategy which the general public is unfortunately very ignorant of, and most brokers don’t understand.

The strategy that I have outlined above is unknown to the average stock market trader but is one of the best trading systems you could have.

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