The option trader s guide to probability volatility and timing phần 5 ppt

... that case, the loss is equal to the commissions paid for the trade. On the other hand, if the stock falls sharply, the losses can be substantial. The downside breakeven is equal to: higher strike ... debit), or $ 15: [ 25 – (5 × 2)] ÷ (2 – 1) – 0 = $ 15] . Losses begin to develop as the stock moves below the breakeven and are limited to the stock falling to ze...

Ngày tải lên: 09/08/2014, 16:20

... as Trea- sury bills and notes. This increases bank reserves, which increases the money supply and causes short-term interest rates to decrease. Reduced rates induce consumers and businesses to ... decreases. When there are less bank reserves, short-term interest rates increase. This means consumers and businesses have to pay the bank more in order to borrow money. Less bor...

Ngày tải lên: 09/08/2014, 16:20

... +70 to + 75 3 Strikes +80 to + 85 –80 to – 85 –80 to – 85 +80 to + 85 Out-of -the- Money 1 Strike + 35 to +40 – 35 to –40 – 35 to –40 + 35 to +40 2 Strikes + 25 to +30 – 25 to –30 – 25 to –30 + 25 to +30 3 Strikes ... predefined loss because the first loss is always the best. On the other hand, discipline gives you the impenetrable strength to ke...

Ngày tải lên: 09/08/2014, 16:20

... Trade Selection 251 Appendix B Option Exchanges, Option Brokers, Option Symbols, and Option Volume 255 Exchanges 255 Brokerage Firms 257 Resources 257 Stock and Stock Index Option Symbols 258 Stock ... option strategies are best for any given situation, and they fail to understand just what the risk is before they make their trades. Jay Kaeppel explains these iss...

Ngày tải lên: 09/08/2014, 16:21

... and the underlying stock is trading at 55 , the 50 call option has 5 points of intrinsic value. If a put option has a strike price of 50 and the underlying stock is trading at 45, the 50 put option ... with a strike price of 50 is considered out of the money as long as the price of the stock is less than 50 . A put option with a strike price of 50 is consid...

Ngày tải lên: 09/08/2014, 16:21

... contrast in returns for these two positions at each price level. Whereas the long stock position makes money if the stock rises and loses money if the stock falls, the option position • Makes money ... which they buy inexpensive options and sell expensive options, thus obtaining the best of both worlds. These are key steps in consis- tently placing the odds as far in your fa...

Ngày tải lên: 09/08/2014, 16:21

... with a strike price of 55 . The stock falls to 45 and the trader decides he wants to short the stock from 55 . To make this happen he calls his broker and says that he wants to exercise this particular ... strike price of 55 . The stock rises to 65 and the trader decides she wants to own the stock. To make this happen she would call her broker and sa...

Ngày tải lên: 09/08/2014, 16:21

... rallies sharply. If the stock drops sharply, your choices are these: • Sell the stock, buy back the call, and exit the trade com- pletely to avoid additional losses. • Hold onto both positions and ... strategy. To un- derstand why, let s consider the primary benefit of this strategy as well as the worst-case scenario. Investors who use this strat- egy generally do so in a...

Ngày tải lên: 09/08/2014, 16:21

... EXCHANGES, OPTION BROKERS, OPTION SYMBOLS, AND OPTION VOLUME 255 Exchanges Options are traded at each of the exchanges listed in Tables B.1 and B.2. Table B.1 Stock and Stock Index Option Exchanges Exchange ... Those who succeed consistently in the long run are those who make the effort and take the time to learn the skills re- quired to achieve lasting success...

Ngày tải lên: 09/08/2014, 16:20

... investors a way to buy and sell shares that represent entire baskets of stocks. In the case of Spiders, the basket of stocks represents the companies included within the Standard & Poor s 50 0 ... rewards. Stories about the large sums of money to be made and the successes of the rich and famous inspire a desire to achieve the same level of financial success. J...

Ngày tải lên: 09/08/2014, 16:20