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1.31.2018 The letter is up! Bookmark

Hey everyone, today's free newsletter is up and today we're talking about Naked Positions. What's that you ask? It's when you sell a put option, for income. However there's risks involved. If you remember, when you buy a call option or a put option you are buying the "right" but not the obligation to buy a particular stock at a particular price. But, when you SELL an option you are now entering a legally binding obligation to do something if your trade goes against you. that costs money. 

 

So we discuss how they work, how they can be very useful and how to avoid the risks as best as possible. Then of course we talk about the current market, and mention some things we did when the market fell 300+ points Tuesday. Give it a read, it's decent stuff!

1.31.2018 - Free Investment Newsletter Bookmark

I promise that this is going to be the last options tutorial for a long time. Each time I think I’m done talking about them, several people will write in with questions about something I’ve mentioned. Last week I mentioned that along with buying call options and put options, the only other sort I’d recommend is the occasional “sale” of an option. So let’s explore that and see how it works. 

Naked positions

I’m going to wrap up our two week tutorial session about options. We’ve discussed what they are, how they work, ways to use them, etc. Today we’re going to end with one of the riskier aspects of options trading, called “selling naked”. While it is indeed more risky, meaning you have to really manage that risk, along with the risk comes big rewards. So, let’s get to it...

1.31.2018 - Insider Bookmark

1.31.2018

Good morning all.  First off let's start with yesterday. 

On Monday, the DOW gave up 177 points in what could only be called "controlled demolition". by that I mean that an awful lot of stocks actually rose higher, including some of the names we were holding. So it wasn't widespread selling. 

1.30.2018 - Insider Bookmark

1.30.2018

Morning all, welcome to the madness. 

Okay, so the first thing that happened was that yesterday the market started getting a little fidgety over interest rates. The ten year had already broken over 2.7%, and we have Janet Yellen coming out on Wednesday to talk about interest rates. With the market at nosebleed levels and the supposed growth we're getting, some in market land got a little spooked and locked up some profits. The feeling was "What if Yellen ends her term being a hawk and wants even more rate hikes??"  It spooked them. 

1.26.2018 - Insider Bookmark

1.26.2018

Friday? Yes it is. How did it happen so fast?  

So yesterday was the second day this week where the indexes put in some really wicked swings. From up 180 to RED and then back to being up 140, the DOW was really putting on a spectacular show of volatility. 

1.25.2018 - Insider Bookmark

1.25.2018

Hello all, are you ready for another installment of "this rising market?"  Because judging by the futures, we're about to see another big up day. 

Or not.

1.24.2018 - Insider Bookmark

1.24.2018

Hi everyone, welcome to Wednesday. 

Yesterday was an up and down roller coaster sort of day, that maybe one could call something of a pause day? Maybe. The DOW ended the day a bit pink, but the S&P and especially the NASDAQ would have nothing of it. They went very green. 

1.23.2018 - Insider Bookmark

1.23.2018

Morning all, and wow, what a morning it's been...already. 

When I first flipped on a monitor at about 5:45, the futures were big and bright. I saw + 60 on the DOW and about + 8 on the S&P.  After shuffling around the kitchen, grabbing some coffee and trying to wake up, I looked again and the futures were RED across the board. The DOW was DOWN 54 the S&P down 4. 

1.22.2018 - Insider Bookmark

1.22.2018

Good morning all, welcome back from your weekend. As always, I hope it was a good one for you all. 

Ours was a lot of fun, starting with Saturday evening as a good friend came over to watch the UFC fights with myself and my son.  After a nice night of good food and entertainment, Sunday dawned bright and clear. Down here in Sunny Florida, the weather returned a bit more towards normal, as the winter blast faded away and we were back into the high 70's. That gave the wife and I a chance to take a nice long hike through a local park, which was capped off by watching a beautiful bald eagle cruising in circles around the lake, looking for lunch. What majestic creatures they are. 

1.20.2018 - Options, the Mechanics of them Bookmark

In today's free investment newsletter, we discuss the mechanics of the simple call option. We talk about the time value, the intrinsic value, the strike prices and more. So many people have been scared off of trading options, as they've been told that they are incredibly dangerous creatures. Well I'm here to tell you that's a bunch of hooey. 

 

Options trading is not more dangerous than normal stock trading. The only big difference is that with an option, there's only a certain amount of time for that option to work. If you buy a stock and it goes down, you can hold that thing for 5, 10 , 20 years hoping it back up. With an option, what ever you wanted to see happen, has to happen before the "end date" that you've selected. 

 

It's called risk management. If you buy a call option against a stock and the option if fading in price, you have the ability to sell for a small loss and move on. Just like putting a stop on any stock you might trade. So, if you've ever been interested in these things, then by all means, give the letter a read. 

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