Covered Calls Made Simple

By Dan Williams

It is amazing to me that not many retail investors understand the concept of generating cash flow from their stock positions. When I tell people that I utilize covered calls to generate extra income, hedge my stock positions, and set strict sell disciplines they look at me like I am crazy. I was introduced to the concept from a stockbroker. The idea of writing covered calls is the only option strategy that you can employ at most of the major brokerage firms for your IRA investments. The reason is that writing covered calls is a very conservative strategy relative to other option strategies.

Covered call writing is very simple to understand. It basically says that I'll give you $5,000 now, if you allow me to buy your stock 3 months from now at a certain price. If I choose not to exercise this option, you keep the money and we part.

Ok so now let us go in more detail. I buy 1000 shares of CDE at $10 and the stock goes to $11 a few weeks later. I can generate cash flow in my position by selling someone the option to buy the stock from me 6 months from now at $12.50. For that option, the buyer is willing to give me $0.50 per share or $500 right now.

The $500 is immediately deposited into my brokerage account, but an option position also shows up on my statement. I can not sell the stock prior to 6 months unless I buy back the option in the open market. The option price can fluctuate from day to day, therefore, I typically hold my stocks until expiration.

Six months from now, two things can happen. First, the stock can go above $12.50 and the buyer of the option "calls" me out of the position which I happily do since I bought the stock at $10. The second thing that can happen is that the stock falls below $12.50 and the option holder is holding on to a worthless option. No option holder is going to "call" you out of the stock if it is $12.50 when he can buy the stock in the open market for $11.50 a share.

You then start the process all over again by writing another call against your position.

Are you beginning to see how cool this strategy is? Here is what I just accomplished. First of all, I lowered my cost basis by 5% or $500. Secondly, I drew a line in the sand and said this is what I'm willing to sell the shares for, $12.50. Third, I generated instant income that I could use for Christmas or just reinvest.

I can not tell you how happy this strategy has made me since the crash of 2000-2001. The strategy has helped me keep my head above water in this depressing market.

There is software available that lets you spot the best stocks to use covered call writing with and that saves you a lot of time in the way of research.

But remember, any option strategy involves more risk than just buying a stock so always consult with a licensed financial adviser first. - 23196

About the Author:

Do not buy any stock trading education materials until you see Lance Jepsen's free stock market blog at how to invest in stock market, and learning the stock market

Small Homes Make Big Splash In short sales in meridian idaho!

By Gavin J. King

Many home buyers toward are edging toward a tendency many real estate industry scholars are surprised with; smaller scale and more affordable housing. Architects across the nation are reporting a higher demand for home plans that feature reduced sized homes and the American Institute of Architects reported that fifty nine percent of home builders are building smaller scale homes.

As everyone's IRAs hit the skids in early 2008, so did the demand for larger houses causing a lot of the chaos still being ironed out in the real estate market. With the lack of money came a desire for a smaller scale home that worked and the square footage average dropped by over 300 square feet.

These mini-houses can even be erected using re-used parts from other homes or outbuildings to lower the expense. In some of these "cottages" the wood is salvaged from old barns, deconstructed residences or some other source of materials to accommodate the reduced budget of today's homeowners.

Given that the little homes are much cheaper in value and can still have many of the extravagances of larger homes, you can understand why the trends are pointing up for them.

Some creative California builders even make their small houses versatile enough to fit on either, foundations or wheels. He sells plans for a little under $999 and builds mobile, small homes for around thirty thousands dollars. He relates constructing a small home to tailoring a suit. Each plan has the homeowner in mind and is adapted to fit any specific desire or need they may express. The traditional construction that many small residences have to utilize are space savers like build in cupboards and storage space.

When big businesses like Home Depot and Lowe's get into the business of selling home kits, you know that it is becoming a growing trend.

Given the tendency of people with extra room to accumulate more stuff, the little home size helps many people deal with the materialist nature we all tend to have. Many homeowners are taking those exact thoughts to heart and exchanging their energy "McMansions" for smaller, if not more humble homes.

Many people prefer the modern features of larger residences, but you do not have to go without when you buy a smaller home. They smaller scale residences even feature amenities like claw foot tubs and double door refrigerators for those of us who prefer those appliances. With economy in mind and luxury featured, these home are drawing a higher degree of green buyers too.

Featuring reduced energy costs and lower mortgage payments, smaller homes are really an easy sale. residences that have conventional ceiling heights of about 8 feet have a record of reduced energy costs. Regardless of if the climate is hot or cold the energy efficient traits of smaller houses pay off due to the fact that you are treating a smaller scale volume of air.

Not only can you save on your energy costs but you can also save in regard to the way you use your building lot. With a little portion of your building lot taken up by the building, you can use more of it to grow tomatoes, raise goats or other pets, or any other recreational pursuit you may choose. Putting up that extra concrete pad for a basketball hoop may even be a reality! - 23196

About the Author:

The author enjoys writing articles on homes in Meridian Idaho and Meridian Idaho homes for sale.

How To Buy Good Cheap Stocks

By Mark Roberts

Stock market trading software is a tool every stock investor should have when trading online. At some point you may have had an account or two with various online brokers and have used their software tools to make money trading online. Its a good ideal to have several tools some independent of the online brokerage houses to help make money trading online.

Most of us know the important points of picking a profitable stock. A good sound stable company, a PE ratio of 10 or more and a company that is in an expanding industry. These methods are for eliminating risky stock picks. To be successful in knowing how to to buy good cheap stocks you should be looking into buying the best stock trading software available to help you make the most profitable stock trades. Professional traders and day traders use all the resources available for choosing stocks.

There are many stock options from large to mid to micro cap when examining all your cheap stock options. You may be learning how to buy good cheap stocks online and the best stock trading software that can do chart analysis and detect chart patterns may help maximize profit. Some software can analyze charts of thousands of stocks and see patterns that the typical professional stock trader could miss when trying to analyze stocks the old way that is why chart analysis is best left to a computer.

The best penny stock day traders are in it for the profit but are very active looking to take quick profit and make trades hourly, daily taking profit quickly from penny stocks. The penny stock investor is in it for the long term and is usually happy just to go with a few picks and trade stocks every so often. Either way if you have a large portfolio or want to get serious then you need some good tools to help make decisions quick and keep risk to a minimum when picking penny stocks.

If your after hours or day trading it is crucial you have penny stock analysis software you can rely on. Successful penny stock trading strategies and systems helps you narrow down the picks that other free tools from big online discount brokers miss. Successful penny stock trading systems should make your picks more profitable, easier and there should be less risk and more profit.

With the popularity of wireless Internet and WiFi access in hotels and on the road it is not unusual for your typical successful stock trader to take their laptop computer on the road to make sure they have no surprises when they return home. Just make sure you have secure Internet access.

Penny stock trading software gives you the information that a professional trader has access to even if you have little knowledge of chart trading to help you pick the good cheap stocks. You can also back up good stock picks form other free tools and save countless hours doing the research manually with you own methods and strategies. You could also learn how to find good cheap stocks.

Even if your new or a novice and you are wanting more control of your stock investments picks and want the power of the professional trading online, using the best stock trading software is the way to go. We all want to create wealth and have financial freedom and to make money trading online is a very viable opportunity for someone who wants to learn how to trade stocks. No matter what you skill level is you should always be reading to increase you knowledge and ability to pick profitable stocks. - 23196

About the Author:

For more information on the Best Stock Trading Software or Stock Trading Software

ETF Trading Basics: The Advantages

By Patrick Deaton

There is no doubt that ETF trading is becoming an interesting topic for many people. The Exchange-Traded Funds market is very detailed. There are many different types of trading in this market and there are many moving parts when one starts ETF trading. This is a very brief look at the advantages of ETF trading and some information that may be helpful to a person who is just being introduced to ETF.

The first thing to be aware of with ETF is that when anyone talks about the "history" of ETF, they are not talking about Wall Street. ETF has been around a very short time and actively-managed since 2008. There are some very large financial firms involved in ETF and that is where the history comes in. One can look at the history of a financial firm or company and see how they have done in other areas of stocks and get a fairly good idea of their record of success.

ETF is growing rapidly. There are many financial advisors who are not knowledgeable of all the aspects of the market because of its rapid growth. In 2008 there were 628 ETFs with $562 billion dollars. By August, 2009, there were 858 with $674 billion. This type of growth, in a volatile market, makes ETFs were looking at seriously.

Among the benefits of ETFs is their likeness to stocks. The difference is that they are usually less expensive and are not actively-managed. Buying and selling of securities to accommodate shareholders does not take place with ETFs. Most ETFs don't have 12b-1 fees. And, there are lower distribution, accounting, and marketing expenses.

There is a tremendous amount of buying and selling flexibility. ETFs can be bought and sold at any time during the trading day. A person can purchase shares on margin and sell short which allows hedging strategies to be used. Most of the benefits of stock trading are included in ETF trading. A person can use stop order, limit orders, use stop-loss orders, and buy on margin options (puts, calls, etc).

Just as with mutual funds, ETFs have tax efficiency. There are low capital gains generated due to low turnover in portfolio securities. The trading gives market exposure and an investor has an economical way to balance their portfolio due to the diversity of trading options. One of the greatest advantages of ETF trading is the transparency. Daily transactions are posted on the ETF brokers website each day that gives a detailed analysis of the net asset value and other details regarding trading for the previous day.

The SEC provides an exemption in order for an ETF to be structured. Most are open-end management investment companies just as money market and mutual funds. This gives them greater flexibility in portfolio construction. ETFs participation in lending programs. They also use futures and options to achieve investment objectives. There is a proposal being considered to create an ETF category so that they will no longer need an exemption from the SEC.

When considering ETF trading it is important to talk to a professional who has knowledge about ETF trading and the intricacies of the market. There are many complex details that one should have a solid knowledge in before entering trading. A professional will be able to assist and advise an individual in the best strategy to be successful when they begin trading. - 23196

About the Author:

Learn how it's very possible to make 6% per month in your investment accounts using etf trading! "Big A" is a recognized expert in the world of etf trading system ... reveals etf secrets that have been kept under wraps by hedge traders for years. Give him your email ... get a free report ... webinar today!

Should I Be Using Forex Signals

By Tim Kaldo

With an instantly changing market and unimaginable amounts of money being exchanged everyday, the foreign exchange is one of the most exciting ways to trade. The rewards can be great and can happen in the blink of an eye. Forex signals is a great tool to get you going in the right direction and can help you make successful trades today.

Do you really need to use forex signals? Imagine yourself at your computer analyzing and trying to find the right time to trade. All of a sudden, you get an email that says a trade is approaching. You get prepared, the moment comes, and you make a trade. A little later, you get a second email that says to close the trade out. You were able to score a profit and knowing the market was not necessary. This is what forex signals are and they are very easy to use.

The advantage of forex signals is that they allow you to do your own thing. You aren't locked to the computer monitor anymore. You are free to do additional things until the best time to trade presents itself. You won't need to glue yourself to the computer and gaze at the charts. If a trade is there, you'll be notified.

Think of the freedom that this represents. You can have the forex signals sent to your phone and as long as you're nearby your trading platform, you can go anywhere you want. You can even place the trades from your cell phone if you desire.

Another great thing about forex signals is the ease of use. You don't need to be a forex genius and analyze markets all day. Take the signal and place the trade. It's as simple as that. Now the only thing you need to study is how to use your trading platform.

Even with the apparent potential of forex signals, you must still be cautious. Forex signals are only great if they win you trades. Despite the fact that your signals may not be perfect, you need to have a good winning percentage. If you're winning more trades than you are losing, you can make it succeed.

What most people overlook, even with successful forex signals, is a sound money management strategy. Remember that you could win every trade but one, but if bet the bank on that one trade you can still end up losing money. Use a consistent amount of money on every trade. Usually traders use a small percentage of their account no matter what. This allows you to grow with your money.

In my opinion if you are looking to trade forex then forex signals are a must have tool for your arsenal. It lets you benefit from the knowledge of professional traders and frees up your time to research other things. You still have the choice of whether or not to make the trade and if you find a good service and can reap the rewards today. - 23196

About the Author:

A great resource on forex signals is available at http://tradingforexblog.com