Options 101.1

The past year I’ve been learning a lot about options and how to use this derivative to create an extra stream of income. It’s a great product but with a lot of conditions. In this post I’ll guide you from the beginning to help you understand and hopefully use this product in your advantage.

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Trade Highlight #8

Due to my investment in the Chinese internet giant Baidu, I’ve kept an extremely close eye on the company. My position of 40 shares is in the red, about $1000. Here is how I got a big chunk of that money back with a Naked Put, within just seven days.

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Trade Highlight #7

In this episode of Trade Highlight we discuss a Naked Put on a troubled real estate company. The trade itself lasted for just a few days but it had the potential to take a few weeks or even months. I made sure I was covered and ready to sit out a longer period, however Mr. Market decided to reward me in the short term.

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Risk mitigation

Risk Mitigation

Risk, it’s something everyone has to deal with, in finance or elsewhere. In the stock market, whether you’re an investor or trader, risk/reward is one of the most important factors. I will explain how I look at risk and decide whether the Margin of Safety is large enough for me.

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