This is technically described as “selling a call (or calls) at a lower strike and buying a greater number of calls at a higher strike price”. Ideally, this trade is initiated for a minimal debit or possibly a small credit. This way, if the stock heads south, you won’t lose much.
So basically, you buy [...]
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Imagine an investment offering returns “Above market rates at no risk”. Why would we take this risky plunge? Would you invest? Even though most of us know that high returns mean high risk, most people would invest their money. The main reason that this occurs is that people fail to understand the risk involved in [...]
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Most people these days have a home computer and access to the internet. Decisions made about investments can be made by utilising this tool and taking full advantage of its power. Let’s take a look at some examples of just how a computer can make your decisions much quicker and easier.
Rates fees and charges
All these [...]
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Beta is the sensitivity of a stock’s returns to the returns on some market index (e.g., S&P 500).
Beta values can be roughly characterized as follows:
Beta less than 0 – Negative beta is possible but not likely. People thought gold stocks should have negative betas but that hasn’t been true.
Beta equal to 0 – Cash under your mattress, [...]
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There is only one way to profit in the market. You must apply a systematic approach over time, compounding as you go. Don’t be so naive to expect you will get rich overnight. Remind yourself that patience is a virtue when it comes to trend following.
You must have the discipline to work within the [...]
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