In Case You Missed It …

Steve, George and I (and the entire OptionsHouse team) have enjoyed writing the blog this year. We like reading your comments, giving our spin on market news, and sharing updates about the trading platform.

There will be a lot more of this in 2011, but before the year draws to a close we wanted to revisit some posts we thought were particularly notable that you may not have seen at the time.

Thanks for reading, and have a happy and safe holiday.

Hard-to-Borrow Fees: OptionsHouse CEO George Ruhana sheds some light on hard-to-borrow fees, which can be complicated and confusing, even for advanced traders. These fees occasionally plague investors attempting to short stocks, but all investors – regardless of preferred trading style – should be familiar with this concept.

Automatic Exercise and Expiration: Do you know what will happen to your in-the-money call when the closing bell rings on expiration Friday?  More important, do you know the risks, however small, of what might happen if left open to automatic exercise?  George takes you through some of the most frequent and important questions about options expiration.

Short Box-Spread Trades: Chief Investment Strategist Steve Claussen discusses the “trap” some traders fall into when they sell box trades.  A box strategy involves two short options (one call, one put) and two long options (again, one call and one put). Unfortunately, box traders will sometimes forget about dividends, leading to unanticipated losses.

Netflix (NFLX) and Option Strike Structure: George uses Netflix (NFLX) shares as an example for discussing a number of issues including straddles, volatility trading, and delta exposure.  He also discusses different ways to view options trading around a planned event (such as earnings).

Day Trading Versus Equity Maintenance: Senior Trade Desk and Margin Specialist Bill Sullivan discusses these two types of margin calls – how they are generated in the first place and what is required to get out of them.

 

 

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Related posts:

1. READ THIS! If You Want to Be Serious About Options Trading
2. Automatic Exercise, After-Hours Risk, and Other Options Expiration Issues
3. The Iron Condor Strategy: Limited Reward with Limited Risk