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Option Investing is a Viable Alternative to Investing in the Stock

If an investor does not have a lot of money but hasn’t interest in being as effective as he can making money in the stock markets, is there an alternative that he can use instead of just always having to buy a stock outright? The answer to that question is yes. I believe that stock options are a viable alternative for investors to assist them in growing their portfolios. Using options is not an alternative that one should use and not think of investing in the stock, but it is an investment tool that could be used alongside long-term stock investing. Let me explain why I believe it’s a good alternative.

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I am going to use the S&P 500 SPDR exchange rate fund, the SPY as an example. As I write this article the SPY is trading at 157.88. If an investor is interested in getting into this ETF, 100 shares would cost about $15,788.00. Obviously, the investor’s intent is to invest because he believes the ETF will go up in value. If it goes up one point to 158.88 the value of the stock is now listed at $15,888.00. Buying the stock, the investor used almost $16,000 to make $100.

If the investor decided to use options instead of buying the stock outright, less money would have to be put on the table. If the investor buys an option that is priced just less than what the stock is presently priced at, it will go up in value as fast as the stock. In the case of the SPY trading at 157.88, that would mean any “call option” with the price of 157 or less. If the investor bought a call option (that goes up in value as the stock increases) it would cost much less but go up in value at the same rate as the stock.

Presently an option priced at 157 with about 60 days left to expire would cost an investor $275.00. If the stock went up to 158.88 the option would be worth $375.00. So one can see how using options can costs less than buying the stock outright.

Let me throw some caution out there to would be investors. It is important for one to do the research needed before one invests. If you are going to invest long-term in a company and you are interested in that stock going up in value, you need to do all the research you can to make sure that that stock is going to go in the direction you wanted to.

Investing in a stock option instead of the stock itself does not mean less research needs to be done. A responsible investor must still do the work necessary before investing in the stock or the option.

PS: Use DailyMarketView.com as one of your tool to make better trading decision today. It’s free!

Bollinger Bands Tutorial

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Trading Weekly Options Using MACD John Mylant

Trading Weekly Options Using MACD John Mylant

Go to http://optionsweekly.org/ to learn more…

Weekly Options Trading Adopting Bollinger Bands Squeeze Play

Weekly Options Trading using Bollinger Bands Squeeze Play John Mylant style

Taken from somewhere

What happens if we miss the mark again on our objections like we did Monday? Joao Monteiro, analyst at Monex Capital Markets, had this outlook:

 “Given the run of misses we’ve seen in U.S. economic data of late, another shortfall here could serve to rattle traders. While this latest correction may be close to having run its course, anything that suggests the U.S. economy is going to struggle as the QE tapering continues will give investors another reason to look for the exit.”

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Trading Weekly Options Using RSI

John using RSI to trade weekly options.

Go to http://optionsweekly.org/ to learn more

Click on the image if you wish to learn this for free.

Click on the image if you wish to learn this for free.

What Are You Waiting For?

What are you waiting for?


“If you only do what you know you can do- you never do very much.”

If you are not making money in the stock market like you want to is it about time you start?

Send me an email and I will show you how:

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Don’t get left behind!

Investment Ideas - Chesapeake Energy (CHK)

Investors should take a look at a company at a have written about many times this year. It would be an undervalued asset play undergoing a transition back to growth. Chesapeake Energy (CHK) is the second-largest producer of natural gas in America. 

Carl Icahn has cleaned up the company and is focusing on core business to improve profitability. Its outlook is especially bright given the switch from coal-fired to gas-fired utilities in the United States. In the short-term, Chesapeake is focusing on increasing highly profitable oil revenue.

https://www.facebook.com/optionsweekly

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U.S. Economic Growth And World Economy

U.S. stock index futures edged up on Monday, ahead of data on both the services sector and factory goods that could give clues on the momentum of U.S. economic growth early in the new year.

Service industry growth slowed sharply in China in December but picked up across most of Europe, suggesting that an uneven global economic performance persists even as most signs point to a strengthening U.S. revival.

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What A New Year!

U.S. stock index futures dipped on Thursday, after the S&P 500 wrapped up its best year since 1997 and ahead of data on manufacturing and the labor market.

 The S&P 500 closed out 2013 with a spectacular 29.6 percent gain for the year - for its best annual performance since 1997 - and adding $3.75 trillion in market value. The Dow climbed 26.5 percent in its best year since 1995. The Nasdaq jumped 38.3 percent, its best year since 2009.

 ”The market is probably headed for a slight pullback just from an overbought, technical perspective,” said Peter Cardillo, chief market economist at Rockwell Global Capital in New York.

Merry Christmas Traders!

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Its the time of the year again..

May you have a great year ahead! Merry Christmas!

PS: visit https://www.facebook.com/dailymarketview/posts/592932807445480 for a free gift from us!

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John’s Thoughts

There are other factors some analysts and investors on edge right now. Rising inventory data continues to reflect weak overall demand, which is due in part to a sluggish economy and simple efficiencies like smaller, more efficient cars.

Here’s either a short-term investment or option trading idea for all the people that do their own investing:

If you buy (gasoline) in December and hold it through (first week of January), it’s successful 82.6%.

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