Trading Facebook Options

In light of the upcoming Facebook IPO we add this discussion of trading Facebook options to our previous musings on GM options and trading puts on LinkedIn options. According to press reports Facebook is soon to announce that it is going public with a $10 Billion offering in stock. Speculation puts the anticipated value of [...]

Profitable Options Trading

After a year of dashed expectations and chaotic markets what is the best route to profitable options trading for 2012? Euro options trading was attractive, and profitable, for many last year as the seemingly eternal European debt dilemma drove the Euro downward. In the US options market calls generally worked in the first [...]

Buying Puts on SAP

Is the current flurry of activity with traders buying puts on SAP part of the greater EU economic picture or does it just have to do with issues internal to SAP. SAP ADR shares are currently lower and have been trending downward for about two months. The put to call ratio for January 2012 puts [...]

Hedging Risk with Options

Hedging risk with options is a common practice of producers and consumers of commodities, companies doing business internationally, and owners of stocks, futures, and precious metals. By buying calls or puts the options trader locks in the equity price and can sell in the case of puts or buy in the case of calls until [...]

Trading Options on Starbucks

As the 40 year old company continues to beat earnings estimates trading options on Starbucks – SBUX – can offer traders a degree of assurance. With options, traders can position themselves so that they will not miss out on continuing stock gains and not be stung by an often predicted but not yet seen slump. [...]

Day Trading Options

The stock market had a strong month and corrected at the end allowing those day trading options to profit from both advances and retreats of the market. The constantly simmering European debt crisis continues to cast a pall over expectations. It is, to a degree, a lose-lose situation. If the wealthier members of the EU [...]

Trading Weekly Options

Trading weekly options offers the trader a variety of short term stock and index opportunities. As of September 21, 2011 the Chicago Board Options Exchange (CBOE) lists 81 stocks and funds available for trading weekly options. These include thirty different classes of options including indexes. Weekly options are listed on Thursdays and expire on Friday [...]

Buying Options on Stocks

Buying options on stocks provides both stock investors and stock traders with two advantages over simply buying, or selling, stocks. Buying call options on stocks results in profits if the stocks go up in price and buying puts on stocks results in profits if the stocks fall in price. We recently wrote about buying calls [...]

Buying Calls on Caterpillar

Caterpillar has been a stock analyst’s pick of late and buying calls on Caterpillar could be profitable. The fundamentals of the heavy equipment maker are a price to earnings ratio of 17.5 but a much reduced P/E ratio if one considers forward looking earnings. This stock has an intrinsic value substantially higher than its current [...]

Falling Asian Stocks and Dollar

As the US congress postures we see falling Asian stocks and the dollar. Countries such as Japan have prospered over the years due to strong exports, especially to the USA. Japan makes very competitive products. Japan also pursues a monetary policy of supporting the value of the US dollar. Japan banks and investors buy US [...]

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