Covered Calls For Dummies

By Laura Heins

Most investors do not understand how to generate cash flow from their stock positions. Covered calls can be used to hedge your stock positions. My stock advisory newsletter first introduced to me the strategy of covered calls. I was shocked to discover that even major IRA accounts ran by brokerage firms allow you to write covered calls because of its relative safety to other option strategies.

The strategy is very similar to selling an option on a piece of real estate. For example, I'll give you $10,000 now, if you allow me to buy your property 6 months from now at a set price. If I choose not to exercise my option, you keep the money and we go our separate ways.

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. One, the stock goes above $12.50 and the person "calls" me out of the position, which I am more than happy to do since I bought it at ten. Second, the stock has declined below $12.50 and the option holder is holding on to a worthless option. The option holder would not "call" the stock from me at $12.5 when he or she might be able to buy it in the open market at $11.50.

I then start the process all over again and write the calls again.

So let me back up. What exactly did I do here? First, I hedged my position by 5% or $500. Second, I set a strict target price that I was willing to let the shares go for, $12.50. Finally, I created immediate cash flow that I could use for my daughter's birthday or reinvest.

This strategy has made me very happy in bear markets because most options expire worthless and I get to keep my stock and what the option buyer originally paid me for the option!

A good friend of mine is a computer programmer. He also shares a passion for covered call writing and has written a program that is in beta testing. I am his BETA Dummy. So far, the program has saved me countless hours of research and has narrowed my focus to a short list of 5-10 natural resource stocks to add to my portfolio quarterly. In future articles, I'll discuss some of my picks and income generated from the covered call strategy, plus provide a link to the option software.

But remember, any option strategy involves more risk than just buying a stock so always consult with a licensed financial adviser first. - 23210

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 Houses Make Giant Value In foreclosures in meridian idaho!

By Gavin J. King

The latest trend toward smaller homes is a result of the economic recession, but has many benefits to both homeowners and our nation. It is reported that nearly 60% of the builders in the United States are building smaller scale homes, by the American Institute of Architects, and the higher demand for such construction is reinforced by the reduction in other costs of housing.

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.

The comparatively low price of 40-90 thousand dollars for a little home illustrates their true value, especially when viewed in the light of homeowners still receiving luxuries like modern homes.

The small homes one California builder makes can be put on a foundation or on wheels. The retail costs for his plans are around one thousand dollars and they are erected for the mid thirties. 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 houses have to utilize are space savers like build in cupboards and storage space.

Even big companies like Lowe's home improvement stores sell a model of a kit home that is designed for owner construction to save you money.

Since so many of the smaller houses seem crowded already, their owners tend to have a reduced desire to accumulate extra material possessions the way larger home do. Many homeowners are taking those exact thoughts to heart and exchanging their energy "McMansions" for smaller, if not more humble homes.

Do not be fooled into thinking that these smaller scale residences are lacking in luxuries or the modern creature comforts of larger homes. Appliances and features likes double door refrigerators and claw foot tubs are all the rage in the mini-houses being built. The green houses angle is one that cannot be overlooked in terms of a smaller home size either.

Since the little houses have a lower energy bill and a reduced mortgage payment, it is not hard to tell you why the trends are what they are. houses that have conventional ceiling heights of about 8 feet have a record of reduced energy costs. This holds true for not only heat but air conditioning as well, so this reduced home plan trend works everywhere from Texas to Alaska.

Finally, have a smaller home erected will not only keep your bills down, but it can also increase the recreational value of your home. With a smaller 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. You can even put that horseshoe pit in that you have been dreaming of! - 23210

About the Author:

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

Trading Multiple Timeframes

By Ahmad Hassam

Multiple time frame trading is a trading method used extensively by forex traders. It involves the use of multiple timeframes. In this method, a trader first looks at a longer timeframe like a monthly or weekly chart to determine the overall direction of the trend.

If the trader finds a decisive long term trend on this timeframe, he/she then decides to drill down to a shorter timeframe like the daily or 4 hourly chart to look for dips or pullbacks in the trend.

A minor downward retracement would represent a potentially high probability entry to get in the trend at a reasonably good price in a strong long term uptrend. Finally the trader may drill down to an even shorter timeframe like the 30 minutes or 15 minutes charts to pinpoint and time the exact entry.

Learn to use multiple timeframes in your trading. How do you trade multiple timeframes? Suppose, you are interested in trading multiple timeframes! You identify the retracement in an uptrend on a 4 hourly chart. What you need to do is to wait for a resistance breakout on a 15 minute chart in the direction of the trend before entering into a long position.

What make multiple timeframe trading so powerful is that it puts the traders on the right side of the market while also identifying the highest probability entries available.

One of the multiple timeframe trading strategies is known as Triple Screen. A triple screen resolves the contradiction between the technical indicators and timeframes. The first screen is the long term charts and strategic decisions on long term charts are made using the trend following indicators.

The second screen is used to make technical decisions about entries and exits using oscillators. The second screen is the intermediate charts. Suppose your favorite timeframe is the 4 hour chart. Call it your intermediate time frame. The third screen can be an intermediate chart or a short term chart. The third screen is used to place buy and sell orders.

Begin by looking at your favorite chart, the one that you use the most. Call it intermediate chart. Multiply its length by five to find the long term chart. Now use trend following indicators on the long term charts.

Staying out of the trade is a legitimate position. Use these trend following indicators like the moving averages, MACD or trendlines in the long term charts to make your strategic decision to go long, short or stay out of the trade.

Return to the intermediate chart if the long term chart is bearish or bullish. Use oscillators like the Stochastics or RSI to look for entry or exit points in the direction of the long term trend. Set stops and profit targets before you switch to short term charts to fine tune entries and exits. To get at the short term divide the intermediate timeframe with 4-6. In our case, the intermediate timeframe is 4 hours, so the short term would be 1 hour charts.

Triple screen is a simple but ingenious multiple timeframe approach to forex trading. Use it on your demo account to get familiar with it before you trade live with the triple screen method. - 23210

About the Author:

Mr. Ahmad Hassam is a Harvard University Graduate. Try This Cash Printing Forex Signal Service From Heaven! First practice on your Forex Demo Account!

Filing Bankruptcy Is That The Best Choice?

By Emma Elvie

We know that when people are experiencing financial trouble they automatically begin to think that filing bankruptcy is the only choice that can help their family. While there is nothing wrong with getting a fresh start to life the truth is that most people do not use other options to avoid this one.

We wanted to write this article because we wanted to alert people that even though filing bankruptcy may seem like the best way to get rid of their debt; the truth is that there are other ways that will help them save their credit.

1. Seek Professional Advice: No we are not financial counselors who can steer you in the right directions; however the truth is that if you have not spoken to one then you do not know all your options. They will be able to take the time to sit down with you to tell you what your options are.

Every town and city has financial counselors who can help people avoid these types of situations. In fact you should definitely find someone that you feel comfortable with and trust so that you can open up about your personal finances.

2. Consolidation Loan: Some people have found that just by consolidating their debt has saved them from this situation. If possible find a company who offers these types of loans that you can use to get out of the debt that you are drowning in.

3. Family And Friends: Now I am not a huge fan of asking your family and friends because many people will not find the ways to repay them. However if all it takes is borrowing a one time payment then you may want to consider asking your friends and family. However you want to ensure that you take the time to repay your family or friends that you borrow from.

Stop by our site below for some more tips and advice that you can use to avoid filing bankruptcy. Our site is filled with valuable tips and advice that will help anyone get their finances back in control. - 23210

About the Author:

Filing Bankrupt What You Need To Know! Debt Relief

Should I Be Using Forex Signals

By Tim Kaldo

Placing trades in the forex market has to be one of the most electrifying things that you can do in the world of trading. Unlike every other method of trading, foreign exchange trading has massive opportunity within it. Any trade could net you a huge amount of profit. With how dynamic the market is, there is the potential to score an amazing trade at any second. If you can get excellent forex signals, you can make a great living all from your bedroom.

So how can you benefit from forex signals? Picture yourself at your PC waiting for the perfect time to trade. All of a sudden, you get a text that says a trade is coming. You follow the signal and open a trade. After a while, you get another text that says to close the trade out. Again you follow the signal and profit from the transaction. As you can see there was no need to study the markets yourself. You also did not need to even make the trade. This is forex signals on a basic level but I think you can see the potential.

As you can see forex signals allow you to use your time better. Not only do you have the choice of if you want to make the trade or not, but you don't have to sit in front of your computer all day studying markets. You can spend your time however you'd like and if a trading opportunity is approaching you'll be notified.

They give you complete freedom. The forex signals can be texted or emailed directly to your cell phone. This means you can do whatever you want and as long as you're close to your trading platform you are good to go. These days you can even make the trade from your cell phone.

One more excellent benefit of forex signals is that you don't have to spend time studying the markets or losing your own money to test out the strategies. You just look at the signal and make the trade. And once you learn how to use your trading platform, you're all set. The know-how that you need now can be learned in one day.

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.

Even when using forex signals, you need a money management tactic as well. If you trade too much on the losses and not enough on the wins, it doesn't matter if you win 90% of the time. You need to be consistent with your money management regardless of your account balance.

Forex signals are a must have for any trading toolbox. You are able to take advantage of what the experts know and make a decision to trade yourself based on that information. You can use it as a learning tool or just to make some profit. The choice is yours and it doesn't get much better than that. - 23210

About the Author:

Need more information regarding forex signals be sure to check out http://tradingforexblog.com