Stocks bounce on Home Depot (HD) earnings. Bearish traders eye ETFs. Read More.
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Stocks bounce on Home Depot (HD) earnings. Bearish traders eye ETFs. Read More.
Stocks stumble on renewed worries about the global economy. VIX rallies. Read More.
Stocks finish mixed, again. Read More.
A busy earnings calendar is likely to drive trading in the week ahead. Testimony from Federal Reserve Chairman Ben Bernanke and economic data later in the week are likely to affect market action as well. Read More.
Listed options contracts trade on one of seven exchanges. The table breaks down the options volume for each exchange for trading on April 27, 2009. The International Securities Exchange [ISE] and the Chicago Board Options Exchange [CBOE] are the two largest and, on a typical day, account for nearly two-thirds of the overall volume (However, ISE was hit with a system outage Monday and therefore the volume on April 27 is less than normal.). The Philadelphia Stock Exchange [PHLX], the American Stock Exchange [AMEX], NYSE-Arca [NYSE], the NASDAQ [NDAQ], and the Boston Options Exchange [BOX] also list puts and calls.
Economic data and the Federal Reserve will impact trading in the week ahead. Read More.
A “roll”, in options parlance, is simply a position adjustment where an investor closes out a position in one options contract and opens a similar position in another contract. Rolling happens a lot around the expiration, as investors close out positions in contracts that will soon expire and open similar positions in later expiration months. Investors sometimes roll positions within the same expiration month to different strike prices. For example, if an investor buys a put with a $50 strike price and the stock falls from $50 to $45, they might bank a profit in the 50s by rolling to the puts at the 45 line. That is, they sell-to-close the 50s and buy-to-open the 45s. Many online brokers today offer tools to quickly roll positions with just one or two mouse clicks.
Uneventful action, but volume picks up ahead of the expiration. VIX falls. Read More.
Debit: The premium paid for an options contract. The funds are debited from the traders account. If an investor opens a spread by purchasing Long Call A and selling Long Call B, where the premium paid for a Long Call A is greater than the premium received for Long Call B call, they have entered a call debit spread.
Credit: The premium received for selling or writing an options contract. If an investor opens a spread by selling Short Call A and buying Long Call B, where the premium paid for Long Call B is less than the premium received for Short Call A, they entered a call credit spread.
New to options? Click here for previous Options 101 stories.
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