Investing in the stock market has a large number of great benefits and can help you achieve your goals. Everyone can be better off by investing at least something into the stock market because of these 4 reasons.
1. Better than Putting it in the Bank
The stock market has the ability to ... Views: 7330
People always talk about buying options. But that isn’t the only way you can use them to increase your returns in the stock market. You can also short options and make money from the premium.
Let me explain how this works. A put option gives you the right to sell a stock at a certain price ... Views: 4700
Put options and short ETFs are two ways you can look at profiting from the downside, so which one is better. What provides the least risk and highest reward?
Well at least when you compare it to your total investment put options probably give you a higher risk then short ETFs do. But all ... Views: 4199
Did you know there was a way to buy insurance for your stocks? It allows you to keep some of the money you have invested if your stock crashes, which could be very powerful when times are uncertain.
It works by utilizing something called a put option. When you buy a put option on a stock you ... Views: 4095
Selling Options has its advantages and disadvantages; if you are interested in getting into option trading this is something you might want to consider.
When you sell options you are not trying to predict which way the stock will move, rather you are trying to decide which way the stock is ... Views: 3920
When you buy a stock option how much are you actually paying for that option? What are you paying for? Not many people realize that a large chunk of the option they are buying might not even be for the underlying stock.
An option price has three major things factored into it; intrinsic ... Views: 3761
Ok, so you have done your homework and found a great stock that you believe will head up. It is following all of your rules.
Now you have to decide, how much of it do you want to buy.
Obviously you don’t want to put your entire account in 1 stock because nothing is a for sure thing. You can ... Views: 3644
Did you know that it is possible to have stocks in your account that you have already made a profit on before you sell it? It is rare, but it can happen.
Here are some tips help you pull out some money from the stocks you already own, and possible even pull out more cash flow from the stock ... Views: 3594
There are a few different ways to invest in the stock market. Each way has its own advantages and disadvantages. The ways you can invest in the stock market are.
1. Buying common or preferred stock
Buying stock and holding onto it for the long term is the simplest way to invest.
Your ... Views: 3587
The single biggest question that new traders ask is how much can I make trading the stock market? They all want to know what annual return they can expect to make, or how much monthly income they will generate.
That is not the question you should be asking. In fact concentrating on that ... Views: 3421
Not many people realize that selling puts can be a very good strategy in the stock market. It can be a great source of income and help you get into stocks that you already like at a lower price.
It works like this you sell someone else the right to sell a stock at a certain strike price on ... Views: 2977
Stock options can be very profitable in the stock market provided you use them right. Whenever you are buying an option you should take some time to consider why you are buying it.
Here are some tips to figuring out when the best time to buy an option is.
1. When the Stock is giving you a ... Views: 2689
Many traders will practice adding to a winning position as well as subtracting from a winning position. These strategies can be very helpful to let your winners grow.
Many traders will practice taking away from their position once a given level is hit. For instance say you want to buy 100 ... Views: 2550
Most traders fail to make money in the stock market because they fail to treat trading as a business. They believe they can just buy a stock it will go up 200%, they sell and everything is good.
That is not how trading works. Sure if you did that you would occasionally get some pretty big ... Views: 2501
Selling options is a great way to make consistent money trading the stock market, but there are a few mistakes that many option sellers will make, especially when they have just started out.
1. Risk Management
It is really easy to forget about risk management when you are winning the majority ... Views: 1908
There are a lot of people who do not believe that you can make money in the stock market by trend trading. They think trading with the trend is a scam that “Guru’s” say to get you to buy their product.
While there can be a lot of scams out there trading with the trend can actually be very ... Views: 1754
Two strategies for making money as an option seller are to either sell naked options or spreads. Selling spreads are often
time the much wiser choice for the following reasons.
1. Lower Risk
You assume a much lower risk when you sell a spread as opposed to selling a naked option. For ... Views: 1644
A bull trap occurs after a long down trend in a stock happens and you may get a signal that it is going to start trending back up. This normally catches many of the market participant’s right before it starts going down again.
There are 3 things that you can do to help avoid being devastated ... Views: 1542
Before you enter the market you will need to decide not only what to buy and when to buy it, buy how much to buy. How many shares of stocks should you buy to limit your risk? Here are some things to consider when you decide that.
1. How much capital do you Have?
How much money do you have ... Views: 1519
Stop limit orders are very powerful in the stock market if used correctly. They can give you a new way of placing a trade that can potentially benefit you.
So when might it be a good idea to place a stop limit order?
1. When a stock is at resistance and you are expecting it to break through. ... Views: 1500
Trading against the trend is not a great idea when you think about it. Everyone seems to want to pick the top or the bottom but there are so many consequences to that kind of thinking.
1. It is low probability
I have heard people say if only they would have picked the bottom they would be ... Views: 1474
Rolling options to a later date is something that you have probably seen if you are trading options. It allows you to get out of a position you are currently in and get into a position at a later date.
I’m sure you know that all option contracts eventually expire. At that expiration date ... Views: 1430
How risky is trading? Is it something that only a few people will ever be able to do, or is it something that anyone can do?
Well anytime you are getting into a stock position you are risking money. There isn’t a way around this simple fact.
There are many market participants that ... Views: 1420
Now is the best time to invest in the stock market. In fact it is normally a great idea to invest in the stock market as soon as you can; since we are all limited on time it is nice to start when we have a lot of it left.
Here are 3 reasons why now is a good time to invest.
1. Should Have ... Views: 1418
There is a big difference between what successful stock traders look for and what the average wannabe looks for. The average investor wants a hot stock tip that is going to go up 10,000% and make them a millionaire overnight.
They do not even think about their specific goal for 1 trade or ... Views: 1371
Covered calls and dividends are two ways to create a consistent cash flow off of the stock market. But which one of these two methods is better? Well let’s look at what they each are.
Dividends are your share of the company’s earnings. When a company pays a dividend to their stock holders ... Views: 1349
Recently every stock has been getting crushed. This means that today is probably one of the best investment opportunities of our life time to get into strong stocks for the long term. So how do you find the best of these stocks to invest in?
Here are a few things you can look at.
1. The P/E ... Views: 1335
With all the different ways to view stock charts today it can get kind of confusing. Figuring out whether to use a line chart, bar chart, or candlestick chart is the first step.
Let’s compare them. Bar charts and candlesticks give you much more information than the simple line chart. They ... Views: 1329
The troubled trader is someone who just can’t seem to make it in the trading world. They may have learned a lot in the past, but are still having trouble making consistent gains.
If you are in this situation these tips can help you out.
1. Turn Off the News
It is very tempting to look ... Views: 1317
Day trading is a great way to make money in the stock market. It has many advantages over other strategies in the stock market, some of which are.
1. You Don’t Have the Gap Risk
Stocks can gap, and sometimes they can gap big. I have seen stocks gap over 20% overnight on a rare occasion. If ... Views: 1316
Counter trend trading is a pretty sought after strategy. Everyone wants to buy a stock as it bottoms or short a stock as it is forming a top. It is the whole buy low sell high idea. Why not buy when a stock is at its lowest and sell right before it turns around.
The only problem with this ... Views: 1309
Buying pullbacks is one of the most famous strategies out there. Everyone wants to buy at the low and sell at the high right? So is it actually a good strategy?
It can be very profitable if you buy a stock as it comes down a little. This is
especially true if the longer term direction of ... Views: 1301
Selling spreads can be a very profitable strategy. Instead of shooting for one or two big home runs it tries to shoot a lot of singles which eventually add up and can cause you to get a great return in your trading account.
The major benefits of selling spreads are that it.
1. Is ... Views: 1300
Did you know that you could get cash flow simply buy holding a stock? It’s true; in fact there are a few ways which investors can make a decent income from the stock market by simply buying and holding stocks. These are.
1. Dividends
Of course when you own a stock that is paying off a ... Views: 1293
Stock splits can be extremely profitable things. When a stock splits it lowers the price that its shares are trading at and increasing the amount of shares it has to compensate.
For example when a $20 stock has a 2 for 1 split the stock becomes worth $10, however there are twice as many ... Views: 1289
Developing your own trading style is of course one of the first steps to actually trading. You cannot simply get someone else’s trading system and make it work for you because it may not fit your needs. Every person is different, and that works its way in the stock market as well.
Before ... Views: 1288
Low volume stocks can make it much more difficult to trade profitable. For that reason it is better to stay out of these stocks regardless of how the set up looks.
Volume should be looked at every time you place a trade. What volume does is tell you exactly how much of a given stock was ... Views: 1276
It is easy to ignore the losing side when trading spreads. Especially when trading out of the money credit spreads and are winning 80+% of the time.
But unless a trader can manage their risk they will eventually lose all of their money. This goes with credit spreads as well. So it is ... Views: 1268
I am a huge stock market geek and a huge poker geek as well. I remember seeing not too long ago a world poker series; they were interviewing a guy from the semi finals who said he was an option trader.
That made me think, trading which is one of my biggest hobbies is very similar to one of ... Views: 1253
Iron Condors can be very profitable at times so how do you find the best time to place an iron condor? When should you enter the trade? This is what everyone wants to know.
Well there are a couple of things that might be helpful.
1. When the Market is going Flat
When stocks are not trending ... Views: 1238
Investing in Dividend stocks can be a great way to increase your returns in the stock market. There are many reasons why this is so, but here are a few.
1. The Income
Of course the first good thing about dividend stocks is the amount of income they can produce. If you have enough money ... Views: 1235
Stock options can either help you to gain a huge return in the stock market, or it can completely destroy your account. Trading them can be a good thing as long as you keep a handle on your risk.
There are three things that may help you to increase your chances of being profitable with ... Views: 1230
Income investing can be immensely profitable in the stock market. Here are the 4 major steps you will have to take in order to get into and manage income stocks.
1. Find a list of Dividend Stocks
There are many ways to do this. You can always do a Google search for the term list of ... Views: 1225
Trading with the trend is one of the most important things you can do in the stock market. It automatically increases your odds of being correct.
There are 3 reasons why it is much better to trade with the trend then against it.
1. Likely to continue
Trends are likely t continue. If a ... Views: 1225
ETFs and covered calls can be a great combination at times. It kind of seems like they were made for each other because ETFs have the following characteristics.
1. Not go to Zero
I have never seen an ETF go to zero before because it is just a combination of different stocks. For it to go ... Views: 1220
The rich love to invest in stocks. In fact the majority of rich people have some money saved away in the market. Why is it? Because it helps them to stay rich and become richer.
Investing in stocks can be a very wise decision.
1. It Has a Good History
The stock market is a bumpy ... Views: 1213
I never sell naked calls, because there is just too much risk involved. How much risk? Infinite! That is right there is no limit to how much you risk on a naked call.
When you sell a naked call you are giving someone else the right to buy a given stock at a given price on or before a given ... Views: 1208
Option trading is a great way to increase your potential returns in the stock market. But even with options there is room for risky traders and less risky traders.
If you want to be a more conservative option buyer you can always buy in the money stock options. If you feel like taking on a ... Views: 1202
In this world there is economics and there is the stock market. The problem comes when people start to assume they are the same thing.
Don’t get me wrong they are related. If the economy is doing great then sooner or later so will the stock market. If the economy is doing poorly the stock ... Views: 1188
Writing covered calls is a very popular strategy in the stock market. And it can be both a great cash flow producer and a not so great means of missing a profit.
When you sell a call on a stock you already own what you are doing is giving someone else the right to buy a given stock at a ... Views: 1159