Many people are increasingly thinking about taking control of their finances; especially in the light of the positives and negatives drawn from the economic crisis.Being more tax efficient with your investments and savings is always a good idea. Looking to adjust existing stocks and shares portfolios is another sensible area of focus. And then there [...]
Back in the summer of 2008 Mervyn King gave the startling news that the average family’s standard of living would ‘stagnate’. This is hardly news as the same thing happened (pretty much) last year and the year before. The huge rise in personal debt is evidence that many people have been financing any increase in [...]
Many conservative income generation trading strategies depend on the time decay inherent in options pricing. When I establish an iron condor well OTM (out of the money), I am selling option spreads and expecting those spreads to slowly lose value as the underlying stock or index trades within a channel. Other traders may use butterfly [...]
Placing iron condor spreads on the broad market indexes is a relatively conservative, non-directional trading strategy that may be used for consistent income generation. This strategy profits as long as the index trades within the channel formed by the two spread positions. It is best used during sideways or slowly trending markets.Condor SpreadsA condor spread [...]
Selling education on options trading is a big business. We see infomercials on television and receive emails advertising free trading software and foolproof trading systems. Unfortunately, there are many “snake oil salesmen” operating in options education. They are busy selling the dream of instantaneous riches without effort – and their price tag isn’t cheap.I recently [...]
One will commonly hear or read the following “rule of thumb” for options spread trading:When implied volatility is high, sell credit spreads and when implied volatility is low, buy debit spreads.Unfortunately, this is simply not true. The credit spread and its corresponding debit spread at the same strike prices will always have virtually identical returns [...]