Option implied volatility and 95% losing trades?

With options, time is not on your side because they depreciate. They are a race against time. Investing is hard enough but making money with options is even harder. I only trade options a few times per year only to make an extra 3-5% alpha per year.Optio

Call Option: Is in-the-money term same for Seller vs Buyer?

The Intrinsic Value of an option refers to how much in-the-money the option is.For a call, it's the Current Price of the underlying less the Strike PriceFor a put, it's the Strike Price less the Current Price of the underlying For

How are retail forex brokers different from betting shops?

Both lose when their clients win.Not true at all.I used a retail forex broker for several years to hedge currency risk that I had from cryptocurrency trading on multiple fiat markets. What I was doing was effectively arbitr

Will rising interest rates boost financial stocks?

Such a question is not directly answerable because there are many factors that go into a bank's profitability, but here's something to consider:Bank's don't make more profit just because the federal interest rate is higher. Banks must pay i

Why doesn’t the stock price fall after the record date for a company splitting stock?

That's not how splits (or dividends) work. If you own one share of stock worth $100 and it does a 4-1 split, you will (eventually) have 4 shares worth $25 each. Anyone who buys stock before the split is effective gets the $100 shares; anyone who buys shares after th

Selling Covered Calls p/l

thought my total p/l would be 0.05c lost per share (-$5) + premium I received for the call (+$10) making the total +$5. Is this math correct?I'm guessing that the call has not expired, but it is now worth less than $0.10 and more t

Are there any investment strategies which take advantage of an in-the-money option price that incorporates no "time value"?

Options can have a negligible time premium. For American1 calls the time premium is never negative. If it had a negative premium it would be profitable to exercise it immediately.A deep in the money call has a delta of exactly one. That is, it's

Is a broker's fee equivalent to one month's rent reasonable in San Francisco?

Just like purchasing a place the brokers/agents have to be paid for their service. If they represent you and if they are finding you place that is being rented by individual owners they may also be getting money from the owner of the property, or splitting

Why should investors care about the interest rate risk, if they only care about the money they have at retirement?

He didn't lock in a growth rate of 4%. He locked in a yield of 4%. That's the amount the bond pays in interest on his original investment each year. If he just spends that money the bond will continue to pay 4% each year, but there'

Most effective Fundamental Analysis indicators for market entry

Unfortunately, there is very little data supporting fundamental analysis or technical analysis as appropriate tools to "time" the market. I will be so bold to say that technical analysis is meaningless. On the other hand, fundamental analysis has some merits. For ex

Relevance of indicators like RSI for long-term investing

I am more of a value investor but dabble in technical analysis, so let's see if we can figure this out.Technical analysis, which involves using indicators such as RSI and CCI, is generally used for short term investing. This isn't to say that it is not usef

What, if any asset classes, were contrarily correlated during crash of 2008

Also, over a span of fifteen years, say 2000-2015, how would a "diversified" portfolio fared vs a portfolio primary comprised of stock index ETFs?An interesting useful site for this is:

Investment vs Income Tax

Best of all the options is Provident Fund. Amount invested, interest and maturity is all exempted from income tax. Interest amount compounds annually. As a private employee, you would already have EPF (Employee Provident Fund) to w

Linking Android to Chromebook Gnucash

Probably not. GNUcash is a software, not a cloud service.At least the version of GNUcash I use (Linux) does not support anything except local file systems.The closest to what you could have is to store the GNUcash file in Google Drive. At least the

If options gives you the RIGHT but not the OBLIGATION to exercise them, then why are they being forcefully exercised if they expired in the money?

Regarding automatic exercise, brokers do not automatically exercise the options. In the US, if an option is one cent or more in-the-money (ITM) at expiration, the Option Clearing Corp (OCC) will automatically exercise options whether they are long or short. This is

Calculating a company's PE value

Assuming:nothing at the company changesthe two current owners are 50/50 partnersthe $45k net earnings is distributed to the owners each yearBuying 1% of the company for $10,000 puts a million dollar ($1,000,000)

Is backtesting only for disproving trading strategies rather than "proving" them?

Backtesting has a problem with overfitting the data. Two ways to combat this are out-of-sample testing and forward testing.

After you sell a put option that you initially bought from an option writer, are you still responsible for buying the shares if it's exercised?

Let's say you buy a put option for 100 shares at a strike price of $100 for a company XYZ that has a stock price of $100.So now you have an option.If you believe the price will go up to $120 and sell the option

Does it make sense as a long-term investment to sell Put Options of a Bonds ETF?

For this to work, there obviously must be a bias for the share price of the ETF to go up long-term.It doesn't have to go up - as long as the price doesn't decline below your strike it could trade sideways or even go down some

Is 6% too high to trade stocks on margin?

6% isn't "too high" in terms of market rates at the moment, however it's a very subjective question whether it's too high for you. The real question to determine is if paying 6%, can you make more than 6% return (to cover the costs plus your profit)?As for

Should a strategy backtested against three years of tick data continue to produce positive results?

The proof is what it does with 750 randomly selected trading days, over and over again. In other words how does it do over a three year period of time, starting with any day randomly selected with a random time step. Based on several thousand "seasons" of d

What would a stock be worth if dividends did not exist?

Unrealistic assumption, but I'll play along.Ultimately, dividends would exist because some innovative shareholder of some company, at some time, would desire income from their investment and could propose the idea of sharing the profit. Lik

Investing $50k + Real Estate

I would say that, for the most part, money should not be invested in the stock market or real estate. Mostly this money should be kept in savings:I feel like your emergency fund is light. You do not indicate what your expenses are per month, but unless yo

How can one protect oneself from a dividend stock with decreasing price?

An alternative options strategy to minimize loss of investment capital is to buy a put, near the money around your original buy price, with a premium less than the total dividend. The value of the put will increase if the stock price falls quickly.Likely, a

Very basic question regarding taxes

Your question can be understood in two different ways (or a mix of both):First option: You are asking why you agreed on a salary of $15,000 annually with your employer, when in the end he subtracts taxes from it and you get only $12,000 in

Is it worth to pay for TurboTax when filing one W2?

It's worth it to actually know how to do taxes for real. On paper, following the instructions yourself. This is a great time to learn, because you get to learn the new version of the forms. You can hit the library and get copies of the popular pa

How Should I Start a Savings?

The very first thing you should do, and something you can do right now, is to set up a savings account, and an automatic transfer into that savings account.Yes, a savings account will likely only earn you a pittance.However, having

Should I open a new checking account at another bank?

There's no problem in having multiple checking accounts, and separating out the activities of building the house for your parents is probably a good idea. (I've got three checking accounts.)Presumably you'll be depositing Large checks, so an onlin

To access an account and make money transfer

You asked, Is this legal?There is likely no law preventing your friend from giving you his credentials, however it's almost 100% certain that your friend's financial institution has a user agreement regarding use of thei

Can you purchase medical/dental insurance after you know you will use it?

The Manulife link you provided says: Your coverage is guaranteed with no medical questions when you apply and pay your first premium within 90 days of your employee benefits ending.That implies that for new cove

What would most likely happen if you owed money to a business upon completion of a service but realised that you don't have a way to pay?

It doesn't matter if your form of payment was lost, stolen, declined, temporarily misplaced, forgotten at home, or borrowed temporarily by a family member; that is your problem not theirs. You requested services and they delivered on the expectation of payment upon

Ways to save for child's college education where one need not commit to set contributions?

529 plans. They accumulate earnings over time and by the time your child goes to college you will be able to withdraw funds for college TAX FREE. The best part about 529s is that there are several different options you can choose from, and you aren

Should market based health insurance premiums be factored into 6 months emergency fund savings?

Yes, you should budget some amount of your emergency fund for healthcare expenses. How much you budget is really dependent on your particular anticipated costs. Be aware that health insurance likely costs significantly more than your employer charges you for acces

Investments and Equity

You need to be clear about who gets your money:If you pay the existing owner $25K and (s)he gives you half the business, then you now own half of a $50K business an the original owner has an extra $25K in spending cash. The value

Is investing this time in a startup worth it?

The problem is that he can only provide us about 1.5-3% maximum of equity of the company.If you get paid enough to do the job you shouldn't care what the equity percentage is; then you can think of equity as a bonus.Eve

Stock options and cash settlement

When you exercise the ITM option, the shares will delivered into your account. If you don’t have enough money to buy the shares, your brokerage should front you the margin. You only get cash when you sell the option or sell the shares for a profit.

What % of the average daily volume of a stock can be purchased without affecting the price of the stock significantly?

There's no way to definitively answer the question other than to say that less liquid stocks are more apt to move in price than more liquid stocks. Each day, it depends on the buy/sell dispersion in the order book. Given that, let's go with your numbers and make

Where does all the money go during a crisis?

Other answers have made some points about money but if you consider your example and stop at the first step in your reasoning, you might get another insight about the nature of the current recession. If airlines stop flying, nobody gets from A to B, that's a service

Is 401k matching unfair to lower-paid employees?

From the employer to employee relationship perspective, one could argue that no, it is not unfair to have percentage based matching, at least by comparison to the fact that oftentimes bonuses and raises are also granted as a percentage of salary.However, unl

highest and lowest in aftermarket seems extreme?

For every trade that occurs, there is a buyer and a seller. Ignoring special circumstances like the seller just needs the money, one of these traders is wrong.Your premise is that the lowest price might be real because everybody tends to buy lower. I'd as

Is losing money on stocks actually simpler than gaining money?

Yes, it is easier to lose money in the stock market, if you are trying to. This has less to do with 'the odds being stacked against you', or something like that, it just has more to do with probability and how 'risk' is defined in finance.Let's assum

Planning on having all bills due on the same day

I currently have 3 credit cards, one of which I virtually never use.I'm planning on calling the companies and asking to change the billingcycle so they end on the last day of each month. This would line upwith my rent so I can pay everything at once.

How can my friend in the U.K. cheaply transfer money to me in Israel?

He can send you a check. This will move the burden of GBP->USD conversion to him (unless the GBP amount is preset, then you'll be the one to pay for conversion either way). You can then deposit the USD check in any Israeli bank (they'll charge commission for the dep

Will this affect my credit

Your credit score is based on many factors, so saying whether your credit will improve or decline because of one action is difficult to say.Your credit score represents both your payment history and your ability to take on MORE debt. So paying your minimum

Am I missing anything from this budget?

If I’m reading this correctly, your budget is equal to your income. In addition, you are talking about spending your entire cash reserves on the house. Both of these are mistakes, in my opinion.Taking out a mortgage, as was suggested in a comment, does not

How can "regular people" get 700k in debt on RobinHood

The trader, holding put-writes and that according to one source, was expected to buy a position larger than the cash in the account. But that position could be immediately sold such that there is merely some amount of loss on the position.So the trader could

Stuck in a debt of 3 credit cards

Do not make any additional debt. You have a serious financial problem now that is you cannot manage your money. With income of 120k you should be able to pay 15k debt each month. You have to list down your expense and cut unnecessary expense. Use that money to pay c

Modelling bank account transfers with double entry accounting

A ledger must be balanced. Period.While your idea of a temporary account to represent Cash-in-Transit or Deposit-in-Transit is an innovative idea, it is not necessary in the context of accounting principle.Once the money left Account A, it is destine

Why don't countries invest?

But if it's so great - why don't countries do it?Oh sure they do. I think you'll find that many countries that have excess oil wealth have decided to invest. For example, see

Best refinance option

Even with my comment, I see this as paying 1/8% more ($22/mo) to avoid PMI ($174) so yes, C is the winner.The question is staying put is a complex one, more so than the A/B/C. Any non-mortgage debt at all? Is your emergency fund ful

Should I re-allocate my portfolio now or let it balance out over time?

As you note, your question is inherently opinion-based. That said, if I were in your situation I would sell the stock all at once and buy whatever it is you want to buy (hopefully some index ETF or mutual fund).According to what I see, the current value of

Is it possible to borrow money to accrue interest, and then use that interest to pay back the borrower + fees?

No. The WSJ prime rate is 4.25%, even the Fed prime rate is 1.75%, way above the 1.20% you'll be making from your savings account. If you are high worth individual with

How do you make money after paying trading fees on a small account?

It's not feasible to day trade with an account worth $100 or $500. Apart from that, in the U.S. you have to deal with the Pattern Day Trader rule. A PDT-er is someone who makes 4 or more day trades (ETFs, options and equities) in 5 business days in a marg

Are there any statutes of limitations on insurance claims?

Statute of limitations varies by state, most are 2 years, according to this article on The Zebra CA gives you 2 years.Wheth

Flash Boys: "That was the tax"

At the top of page 50 it states:Someone out there was using the fact that stock market orders arrived at different times at different exchanges to front-run orders from one market to another.Their program built in delays so

Buy my leased car?

2 bits of advice. Don't ask me any questions about my car. I know it has 4 wheels, and runs on gas. More than that, I don't know (I lied, I know it has a cassette deck), and I don't care. Never take financial advice from a car salesman. Why would you? The

Daily trading: recovering price change as cash, what am I missing?

I don't understand how my ML-based predictor with %80 accuracy can generate $1000 in cash by daily tradingI strongly suspect that your evaluation of the predictor is

Downsides to mortgage refinancing?

It depends on what your objective is. If your objective is to eventually own your home with no mortgage then what you are doing makes no sense:You are adding $12,000 to your debt, presumably because there are “points” (fees paid to get a

Credit score dropped 73 points after applying for a new card?

First thing. Don't panic. The reason why you have a good credit score is so that when you need credit they approve it.Check the dates to make sure that the application for newest credit card, and the creation of the other credit card match the dates you expe

Cheapest Auto Insurance - company compensates other driver in an accident only if I can't

Former rental car employee - your head is in the right place but you're missing one thing. Rental car companies (at least the big green one I worked for years ago) don't sell insurance, they sell a damage waiver. All it's doing is waiving their right to go after y