Stocks

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How to Invest in Stock in a Bull Market

Being fully invested in stocks at the beginning of a bull market makes for spectacular success. But doing so takes some courage. Then again, who says you have to get the whole enchilada? You can begin [more…]

How to Invest in Stock in a Bear Market

Sticking to a buy-and-hold strategy (where you buy stock and hold onto it for better or worse) at the onset of a bear market is financial suicide. People have a tough time selling, and financial advisors [more…]

Stock Investing in an Uncertain Market

The end of a bear market doesn’t automatically mean the beginning of a bull market and vice versa. Sometimes markets move sideways or very little either way until investors and participants in the economy [more…]

What Are Exchange-Traded Funds All About?

A share of an ETF (exchange-traded fund) represents ownership (most typically) in a basket of company stocks. To buy or sell an ETF, you place an order with a broker, either by phone or online. [more…]

Why Exchange-Traded Funds Are Better than Individual Stocks

Why buy a basket of exchange-traded funds (ETFs) rather than an individual stock? You’ll sleep better knowing that your risk is spread around, rather than based on the performance of a single stock that [more…]

Potential Pitfalls of Trading ETFs

Here are some facts about ETFs that you should consider before investing your hard-earned dollars in exchange-traded funds. You have to pay a commission every time you buy and sell an ETF. The good news [more…]

The Basics of Placing an Order to Buy ETFs

Your first step to buying exchange-traded funds is to set up an account with a brokerage house. Then, you’re ready to buy your first ETF.

ETFs are usually traded just as stocks are traded. Same commissions [more…]

How to Manage Risks with ETFs

Asking how risky, or how lucrative, ETFs are is like trying to judge a soup knowing nothing about the soup itself, only that it is served in a blue china bowl. The bowl — or the ETF — doesn’t create the [more…]

ETF Investment Strategies to Reduce Risk, Optimize Return

When you invest in exchange-traded funds (ETFs), you're wise to invest in both large growth and value stocks — separately. That approach gives you the opportunity to rebalance once a year and, by so doing [more…]

Are Index, Equity-Indexed, and Fixed-Indexed Annuities All the Same?

Index annuities were created in 1996, when investors were shifting their attention from bond-based investments like fixed annuities to stock-based investments, including mutual funds and variable annuities [more…]

Key Futures and Options Exchanges in the U.S.

Several active futures and options exchanges exist in the United States. Each has its own niche, but some overlaps occur in the types of contracts that are traded. Here are the names to know among American [more…]

Comparing American- and European-Style Options

There are two major categories of options: American-style and European-style. Which type you choose depends on the way you want to exercise them, and each has advantages you should know about to make wise [more…]

Housing Starts Reports Reflect Construction Trends

Released every month, housing starts statistics are compiled by the U.S. Commerce Department and reported in three parts: building permits, housing starts, and housing completions. [more…]

How to Use Straddles in Futures and Options Trading

In advance of the release of a big economic report, you can set up a straddle. This strategy is simple to execute and the financial move can be quite profitable. [more…]

Factors to Consider When Using Straddles

You can create a straddle when you simultaneously buy a put and a call for the same stock at the same strike price and of the same duration. Keep in mind that there are some important factors that you [more…]

Trading on Margin Basics for Futures and Options

Margin is what makes futures trading so attractive, because it adds leverage to futures contract trades. The downside is that if you don’t understand how trading on a margin works, you can take on some [more…]

What’s the Difference between Stocks and Options?

Just like stocks and futures contracts, options are securities that are subject to binding agreements. The key is that options give you the right to buy or sell an underlying security or asset, without [more…]

How a Call Option Trade Works

You can think of a call option as a bet that the underlying asset is going to rise in value. The following example illustrates how a call option trade works. [more…]

How a Put Option Trade Works

Put options are bets that the price of the underlying asset is going to fall. Puts are excellent trading instruments when you’re trying to guard against losses in stock, futures contracts, or commodities [more…]

Protecting Your Stock Trade by Diversification

A diversification strategy is pretty simple, and it works best when you own more than a couple hundred shares of a stock. In this strategy, you sell more than one covered call at different strike prices [more…]

Following Up after Writing a Call in an Options Trade

Your job as an options trader starts when you make the transaction. The heavy lifting is what lies ahead, during the follow-up — managing the position, which is more difficult in some ways than opening [more…]

What Is Call Buying in Stock Trading?

Call buying is different from call writing, because it isn’t usually used by traders as a hedge against risk. Instead, call buying is used to make money on stocks that are likely to go up in price. [more…]

How to Calculate the Break-Even Price for Calls and Puts

Before you buy any call or put option in your stock trading adventures, you must calculate the break-even price. Here's the formula to figure out if your trade has potential for a profit: [more…]

What to Consider When Buying Put Options in Stock Trading

When you buy a put option, you’re hoping that the price of the underlying stock falls. You make money with puts when the price of the option rises, or when you exercise the option to buy the stock at a [more…]

Basic Strategies for Buying and Selling Puts in Stock Trading

Put options are bets that the price of the underlying asset is going to fall. Puts are excellent trading instruments when you’re trying to guard against losses in stocks, futures contracts, or commodities [more…]

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