Mutual Funds

Bond Mutual Funds

A bond mutual fund invests in debt instruments issued by governments and/or corporations. Most of these funds are designed to provide interest income for shareholders in the form of dividends that represent the total interest payments made by all bonds in the fund’s portfolio. Unlike the individual bonds within a bond fund, the fund itself […]

Options

Back Spread with Calls

Also known as Ratio Volatility Spread or a Pay Later Call, the back spread with calls is an unusual strategy. Essentially, you’re selling an at-the-money short call spread in order to help pay for the extra out-of-the-money long call at strike B. Establish this strategy for a small net credit whenever possible. That way, if […]

Options

Cash-Secured Put Strategy

Selling the put obligates you to buy stock at strike price A if the option is assigned.In this instance, you’re selling the put with the intention of buying the stock after the put is assigned. When running this strategy, you may wish to consider selling the put slightly out-of-the-money. If you do so, you’re hoping […]

Stocks

Managing Stock Positions

Common methods: Scaling Scaling refers to a somewhat systematic approach of getting in or out of a position in phases instead of all at once. Those phases are defined by share or dollar increments up to your maximum investment. The key to using this method is the planning is done in advance (see pyramiding up), […]

Mutual Funds

Index Mutual Funds

An index mutual fund is typically comprised of most or all of the stocks that make up a particular index, such as the Dow Jones industrial average (DJIA) or Standard & Poor’s 500 index or any of the other broad market indices covering different types of companies, industries or sectors. The index on which the […]

Trading

What is Your Investing Persona?

When it comes to investing, we each our own motivations, and roadblocks. Despite our differences, we can often find parallels in the way we each go about our investing life. There is a wide spectrum of different types of investors. Knowing where your behaviors and perspectives compare to others in a similar situation can be […]

Mutual Funds

Actively vs. Passively Managed Mutual Funds

Whether a fund is actively or passively managed can substantially affect your bottom line. As you will see in the table below, fund management can impact something as simple as how diversified the fund’s investments are, to more complex issues such as tax efficiency.Before investing in any mutual fund, carefully consider information contained in the […]

Options

Long Put Spread

A long put (or long vertical) spread gives you the right to sell stock at strike price B and obligates you to buy stock at strike price A if assigned. This strategy is an alternative to buying a long put . Selling a cheaper put with strike A helps to offset the cost of the […]

Options

Synthetic Long Stock

Also known as a long combination strategy, buying the call gives you the right to buy the stock at strike price A. Selling the put obligates you to buy the stock at strike price A if the option is assigned. This strategy is referred to as synthetic long stock because the risk/reward profile is nearly […]

Options

Long Call Strategies

A long call gives you the right to buy the underlying stock at strike price A. Calls may be used as an alternative to buying stock outright. You can profit if the stock rises, without taking on all of the downside risk that would result from owning the stock. It is also possible to gain […]