Weekly Options – Be Aware Of The Risks
Options trading becomes more and more popular every year. The options become more liquid and more traders use them for hedging, speculation, income etc. Weekly options (weeklys), introduced by CBOE in October 2005, are one-week options as opposed to traditional...
Who thinks Covered Writes Should be Illegal?
Dan Sheridan posted an article yesterday “Why should Covered Writes be Illegal?” A covered write is more commonly known as a covered call. Dan has an example of XYZ stock (I love XYZ stock…) +100 XYZ stock @ 90.00 -1 Aug 95 Call @ 1.00 Dan made a few...
Trading Options Around Earnings Releases, Part I
One of the advantages of an option based approach to trading is the ability to capitalize on trades that have a statistically well-defined high probability of profit. When events occur with predictable regularity, the knowledgeable option trader can effectively...Tax Advantaged Options
Did you know that certain options have special tax treatment? The IRS has favorable tax treatment for anything termed a “IRS Section 1256 Contract.” These are: Regulated futures contracts Foreign currency contracts Non-equity options (broad-based stock...