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Option 4 Calls and Puts
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CALL OPTIONS, PUT OPTIONS!
TRADING PUTS AND CALLS!

TRADING PUTS AND CALLS!


Option 4 Calls and Puts

Leveraged Put and Call Option Stock Investing Information & Ideas

@ $39.00/Month(Save 36%) pay $299.00 annually

Stock Investing for Buying Puts and Calls, Trading Puts and Calls, Stock Puts, Calls and Puts, Trading Puts, Call Option, Put, Puts, or Put Options-   (General Online Investing Information, Education and Ideas)

 

Why the Call Option or Call Options?  Profit in Bull Market Stock Investing!

  • Investor has a Bull Market, Stock Investing environment.
  • Investor's advantage in Stock Market Investing is to leverage Call Options with limited Stock Investing risk.
  • Investor increases Stock Investing value without committing the investing capital to purchase shares.

 

Trading the Call Option is simple, yet a very popular strategy for Bull Market, Stock Investing Call Options allow investors to profit from Stock Market Investing in an upward move in the price of the underlying stock, while risking less Stock Investing Capital than with the outright purchase of an equivalent number of underlying shares, usually 100 shares per Call Option contract.

           
Call Option Example:   Stock Investing in ABC stock  is trading @ $31.00 per share.


Outlook: Bull Market- anticipate good earnings in ABC stock and would like to take advantage of a potential increase in the stock market investing environment.


Call Option Trading Strategy:


Buy 30 Contracts ABC December 35 strike call options at $1.00 per contract.    (Equals 100 shares per contract)

 

Cost of Call Option Trade:          30 x 100 x $1.00 = $3,000.00

                                           (30 Contracts Controls 3,000 shares)

 

Cost of Stock Trade:                  1,000 shares x $31 = $31,000.00

 

*All values shown are at the time of expiration.  Commissions and other trading fees not included.

 

Stock

Per Share

Call Option Contracts

Stock Trade (1,000 Shares)

Net Profit/(Loss)

Call Option

Net Profit/(Loss)

$25

30 @ 100 Shares Ea.

($6,000.00) Loss on Stock

($3,000.00) Max Loss

$30

30 @ 100 Shares Ea.

($1,000.00)

($3,000.00) Max Loss

$36

30 @ 100 Shares Ea.

$5,000.00 Profit

$0.00 (Breakeven)

$40

30 @ 100 Shares Ea.

$9,000.00

$12,000.00 Profit

$45

30 @ 100 Shares Ea.

$14,000.00

$27,000.00 Profit

 

Other Example Earnings Outcomes:

            A) Bought 30 ABC December 35 strike call option at $1.00.

            Sell the call option before expiration:

            ABC Stock goes from $31 to $34.
            Earnings out and volatility drops from 50% to 35%.
            December 35 strike call option goes from $1.00 to $1.40.

            (Equals 40% profit)

            Even though the stock advanced $3, a 15% decrease in volatility

            has suppressed the value of the call option.

 

            B) Bought 30 ABC December 35 strike call options at $1.00.

            Sell call options before expiration:

            ABC Stock goes from $31 to $34.
            Earnings out and volatility drops from 50% to 48%.
            December 35 strike call option goes from $1.00 to $3.10.

            (Equals 210% profit)

            The stock advanced $3 and volatility decreased by only 2%.

            The call option increased in value by $2.10 with the upward move

            in the stock.

In Summary: When planning trades it is important to understand the Vega component of the call option.  Remember, Vega is the change in an options theoretical value for every one-point change in volatility.  Volatility up, Call and Put prices up. Volatility down, Call and Put prices down. ( FOR SAFETY USE THE VIRTUAL STOCK EXCHANGE )

 

Why buy Put, buy Puts, or Put Options?

  • Investor is in a Bear Market and bearish on Stock Investing.
  • Investor's advantage in Stock Market Investing is to leverage put options with limited stock investing risk.
  • Investor wants to buy puts in anticipation of a decrease in stock investing value but,
  • Does not want the unlimited upside risk of committing stock investing capital for a short sale of the shares.

 

                       Financially Transmitted Diseases-(FTD’s-Like STD’s)!

                             Bearish Trends!                     Fundamentals!                    

                      Laws of Physics!                              Technical Indicators!

                      Negative News!                     911 Events!

Many factors affect values of stock market investing.  These Stock Investing factors help develop a successful online investing portfolio of put trades! 

 

Example:

On October 26, 2009, BAIDU, Inc. (BIDU) reported earnings that beat consensus estimates by 9.78%.  But, BIDU offered lower than expected Q4 guidance, citing its efforts to transition advertisers to its new "Phoenix Nest" platform.  This sent the stock on a “Free-Fall”.   BIDU opened on 10/27 and immediately fell from $432.97/share to $353.03/share.  This represented a drop of $79.94/share (18.46%).    A BIDU NOV-09 430 PUT (BPJWF) exploded from $18.50/contract up to $47.60/contract representing a gain over 157% in one day.  Stocks can fall in one day an amount that took them many days to achieve.  BIDU took 320 days to go up from $100.50/Share to a high of $439.90/share averaging $1.06/day.

Trading Puts, Stock Puts, Put, Puts, or Put Options are simple, yet very popular strategies for Bear Market, Stock Investing.  A Put option allows investors to profit from a downward move in stock market investing, while risking less stock investing capital compared to greater initial margin requirements needed for a short sale of an equivalent number of underlying shares, usually 100 shares per put contract.  In addition, a long put holder is not subject to margin calls with an increasing underlying stock price as are investors in a short stock position.

           
Put, Puts, Put Options, Trading Puts Example:  ABC stock is trading @ $36.


Outlook: Bear Market- Would like to profit on bear market outlook for ABC stock with limited risk.

Put Option Trading Strategy:

Buy 10 Contracts ABC August 35 strike Puts at $2.25 per contract.

                      (Equals 100 shares per put contract)

Cost of Put Option Trade:         10 x 100 x $2.25 = $2,250.00

                                               (Controls 1,000 shares)

*All values shown are at the time of expiration.  Commissions and other trading fees not included.


Stock

Per Share

35 Put Option

Value

35 Put Option (10 x 100 = 1000 shares) Initial Cost

Put Option

Net Profit/(Loss)

$45

$0.00

($2,250.00)

($2,250.00)

$40

$0.00

($2,250.00)

($2,250.00)

$35

$0.00

($2,250.00)

($2,250.00)

$30

$5.00 x 1000 shares

($2,250.00)

$2,750.00

$25

$10.00 x 1000 shares

($2,250.00)

$7,750.00

 At Expiration of Put:

Maximum Profit = Price of underlying stock reaches $0.00

Breakeven = Strike Price – Premium Paid = $35.00 - $2.25 = $32.75 per share stock price

Maximum Loss = Total Premium Paid = $2.25 per share x 10 x 100 = ($2,250.00)

In Summary: Purchase an ABC put if you anticipate a significant decline in the stock and you have a timeframe in mind to realize your forecast.  Risk is limited to the total premium paid for the Put.  Profit is theoretically limited.

 

Option 4 Calls and Puts includes:

 

  • Option 4 options Newsletter- Market News, Strategies, Analysis, Insights, General Information and Education you need to become better in your options trading.   This FREE OPTION NEWSLETTER covers Risk Management, Innovative Solutions, Guidance, Insights, Special Service Opportunities and Powerful Sources for your benefit to help you understand option trading psychology and the "Do's and Don'ts" of option trading and will improve your online investing research and decisions.

 

  • Access to Members only site for information on alerts, portfolio, performance, and money management.

 

  • Whether we are in a Bull Market or Bear Market mode, we will email alerts 4 times per month to share information and ideas for trading puts and calls.  We break the option trade down so you can consult your investment advisor.

 

  • Call Option– Profit from Bull Market trends with general information and ideas on call option analysis and call option trading to cover each trend.

 

  • Call Options on selected ETF’s.

 

  • Call Option + out of the money puts for downside protection.

 

  • Put Options – Profit from Bear Market trends with general information and ideas, put option analysis and put trading to cover each trend.

 

  • Puts on selected ETF’s.

 

  • Put + out of the money calls for upside protection.

 

  • We will give performance updates and review all positions regularly.

 

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  • Free 14 Day Trial! – Try our service!  Give us the pertinent billing information.  We won’t bill your credit card until after the trial period.  If our service is not for you for any reason then cancel during the trial period.

 


Option 4 Calls and Puts

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Leveraged Calls and Puts, Option Trading Information & Ideas

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Option4Options.com services are intended to appeal to the Self-Directed Investing public, including fledgling investors, consumers interested in trading options, and long-term and short-term active traders.  "It should not be assumed that our ideas provided in the future will be profitable."  Option4Options, LLC does not guarantee investing returns.  "Guaranteeing an investing return is per se an unethical practice and is a violation of our company policy."

Content on this site is for educational and informational purposes only, and never constitutes a recommendation to enter into any securities transactions or to engage in any investment strategies presented in such content.  Internet Communications from Option4Options.com does not involve either effecting or attempting to effect transactions in securities, or rendering of personalized investment advice for compensation, as may be, in any State over the internet, but is limited to the dissemination of general information.  The staff at Option4Options, LLC does not proclaim to be registered Broker Dealers, Agents or Investment Advisors.  We recommend that you consult a REGISTERED BROKER DEALER, AGENT, OR INVESTMENT ADVISOR to check out any information that you attain from our company.  For reference purposes, we link to other sites, but we have no control over these sites and their presence does not imply any association with, endorsement of, or approval of their services, merchandise, materials or content. 

IMPORTANT RISK DISCLOSURE:  Options trading carries substantial monetary risk and may not be suitable for all Self-Directed Investors.  There are different levels of risk associated with various options positions, and you should familiarize yourself with the type of options (i.e., calls, puts or spreads) you contemplate trading.  Short option positions have an unlimited risk and are subject to margin calls or liquidation in accordance with Regulation T requirements.  Due to the leveraged nature of options, short or naked positions can result in a loss several magnitudes greater than the initial investment or capital requirement.  If the option is not covered, the risk of loss can be unlimited.  You should calculate the extent to which the value of the option must increase in order for your position to become profitable (taking into account the premium and all transaction costs).  Only risk capital should be used for margin-based trades.