Category: Strategy

Covered Call

A call writing strategy or a covered call strategy is when an investor or trader sells a call option to either enhance his portfolios earnings or to mitigate the portfolios risk profile.  This strategy is often used by both experienced investors and investors who are new to options trading....

Risk and Bet size

Risk/ Reward The essence of a trailing stop loss is that each time the market moves higher, the risk reward profile of the trade remains similar to the initial risk reward profit.  This is called maintaining the risk/reward profile.  A trader should avoid placing a trailing stop loss at...

Straddle

If you are a trader and you are interested in speculation on movement in the market as your main goal, there is a very efficient product that allows you to capture this particular trade.  A straddle is an investment where the trader purchases both a put and a call at the...

Money Management Trading

The plan Money management techniques are broken down in to a couple of specific areas.  The first is how much capital should a trader allocate to a trade, and the second is how much money a trader should be willing to lose on a particular trade.  Prior to entering...