Category Archives: Options

Easy as ABC: How To Trade Alphabet (GOOG) Using Options

  • Alphabet is a strong contender in the tech space, with several growth opportunities available to them
  • They are rapidly expanding their artificial intelligence and cloud platforms, while maintaining focus on their core competency, the search engine.
  • They have strong financials, with positive cash flows and continued revenue growth
  • They are an expensive stock to trade, but there are ways to implement bullish strategies using options to avoid high capital costs

Let Me Google That For You

Alphabet (GOOG) is a staple in the tech industry, and they are constantly engaging in acquisitions and various growth opportunities. Their position isn’t going to be knocked away anytime soon, as they have exposure to almost every new development in the space, ranging from artificial intelligence to self-driving cars.

However, the digital world continues to evolve, and it is increasingly important that Alphabet stays on top of the trends. Search and ad revenue remain key drivers for the company, but other mediums for search, such as voice assistants like Amazon’s Alexa, pose a big risk.

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Futures, Forwards, and SPOTS: How the World Can Trade Pork Bellies Without Ever Touching a Pig

Confession: I normally don’t do much research outside of options and long stock.

Not because the other platforms are some terrible place where people are yelling about pork bellies and soybeans, but simply because I don’t really understand it.

So to make up for admitting my weaknesses in finance on my finance blog, I decided to learn.

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Trading Naked: How to Cover Your Assets

I recently had a conversation with a good friend of mine. Our friendship blossomed when he talked about puts one day in our Applied Investments class. My head whipped around to locate the person that was finally speaking my language, and once we did the options trader secret handshake, we became fast friends.

One of our more recent conversations surrounded the economics of options – He said that basically, if you’re on the sell side of a naked option, your margin requirement (collateral) is going to be pretty high.

But I disagree.

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Trading Options: Deriving the Value of a Derivative

One of the biggest questions that I get asked is: “What’s the point of trading options?” I give the usual spiel:

  1. Reduce your cost-basis (how much you pay for a trade)
  2. Increase your profitability (the chance you have to make money)
  3. Increase the number of trades you can make, putting the law of large numbers in your favor
  4. Place neutral, bullish, or bearish trades on the market
  5. Thus, you can make money when the market goes up, down, or all around
  6. Use math and probability to make money
  7. Take control of your financial future
  8. And have fun! 🙂

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Smart Money: The Poor Man’s Covered Call

In my most recent blog post, I talked about shorting/selling a call, aka a covered call. This technique is used as a way to reduce cost basis against shares held, and can also be used as an income generation technique for larger accounts.

However, not everyone has a large account (I definitely don’t). So what are some alternatives to going long on 100 shares and selling a call against it?

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