Category: Investments
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How Option Greeks Affect Covered Calls
The concept of a stock option is fairly straightforward: It provides the right or obligation to buy or sell a stock at a specified time and price. Of course, the…
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Starting a Position with a Covered Straddle
There are many different option strategies that investors can use to generate an income. While covered calls generate an income from an existing long stock position, a covered straddle can…
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Generate an Income from Credit Spreads
Income investing is popular among investors in or approaching retirement, but there are few good choices during periods of record-low interest rates. Exchange-traded options provide an easy way to generate…
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Buying Protection with a Married Put
The stock market is known for rising during both times of euphoria and fear. For instance, the stock market hit record highs during the COVID-19 pandemic despite extremely high levels…
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How Dividends Impact Option Pricing
Dividend stocks are a popular way to generate income, but they also impact several other investment strategies. For example, dividends impact option pricing. Let’s say that an investor that’s selling…
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What Are the Components of Asset Allocation?
It’s easy to see that many financial assets are highly correlated — especially large assets. If there is a new sign of an economic slowdown, investors expect the entire S&P…
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Can I Trade Options on an Index
Passive investing has exploded in recent years. Investing in broad-market indexes has surged in popularity and costs less than ever before. You can take this approach to the next level…
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Can I Trade Options in an IRA?
Many individual investors wish to utilize options trading to generate income but are unsure of whether or not they can trade options in an IRA. Most individual retirement accounts (IRAs)…
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Regulation T: What It Is and How It Impacts Margin Accounts
Margin accounts let investors borrow money from their broker to purchase stock. This leverage enables them to realize higher returns, but the same leverage increases risk. If the equity in…
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Bond Ladders vs. Bond Funds: What’s Right for You?
Many retirement investors are interested in bonds because they are both safer and more predictable than the stock market. Bonds pay out interest payments on a regular basis, and if…