Friday, April 25, 2008

Option Trading Strategies You Can Use Now

Option Trading Strategies: Three Ways to Profit in a Bear Market

In a bear market, most people lose a lot of money. Are you cognizant of the bursting tech bubble and consequent recession circa 2001-2002? In this article, we will be covering three option trading strategies for a recession or a bear market, which will allow you to maximize profits rather than lose money.

Read the full article: Option Trading Strategies

Tuesday, April 22, 2008

Stock Options Pricing

How are stock options really priced? Knowing and understanding how options are priced and be the difference between you making money or losing your shirt.

One of the biggest misconceptions about options is that they are 100% related to the stock's price.
This is not true, it is possible to buy a call option on a stock, the stock's price goes up and the options price goes down.

That is because there are 2 different parts of an option. The first is called intrinsic value. This is simply the difference between the stock's price and the options price. So if we buy a $90 call on a stock that is trading at $98 the intrinsic value is $8.

Read full article: How options are priced