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Today’stickers: BIDU, VIX, JWN, SII, F, GM, WMT, NRG, GSF, GOOG BIDU – When Confucius said that a journey of a thousand miles starts with a single step, he didn’t know he was likely referring to the share price performance of Chinese Internet search-engine Baidu.com. Just one year ago the shares could be bought for…click to read more.

NOTES OF J.P.MORGAN (JPM) Covered Call 1. By June of 2003, JPM had traded up from a lower trading range in the $25.00 area to a new range around $35.00. 2. Since entering the new trading range in June, the stock has consolidated into a relatively flat, horizontal trading channel. For the most part, this…click to read more.

NOTES ON McDONALD’S (MCD) Covered Call 1. Around June 2, 2003, MCD breaks out through a resistance level established back in late Nov. early Dec. 2002 after failing to break that resistance level in mid May 2003. 2. MCD climbs up from $20.00 to the $25.00 range in a slow gradual uptrend step like pattern.…click to read more.

Rolling is defined in options as moving a position from one strike to another either vertically in the same month, horizontally to another month or some combination thereof. Other times, you may have to buy your short call back so that you will not lose your stock. Sometimes, you may even want to allow the…click to read more.

October 7, 2007 Market Report

Monday, October 8, 2007
Filed Under Market Snapshots 

Well, there is an old axiom that says something like “a sane man who dwells in a society of the insane, will then appear insane himself”.  This paraphrasing is, I am sure, words that ring very true to market bears that find themselves scratching their heads after yet another decisive rally on Wall Street on…click to read more.

Professional traders use the term “lean” to refer to one’s perception about the directional strength of the stock. When you own a stock and intend to hold it for a period of time, you are aware that you will probably be holding it while it goes up and while it goes down. This means that…click to read more.

The “stagnant” scenario When we apply the covered call strategy to the stagnant stock scenario, we take a negative return scenario and turn it into a positive scenario. Remember, when we sell an option, we receive a premium for doing so. When the stock does not move during the option’s life, the extrinsic value of…click to read more.

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