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Purchasing put options or selling call options to protect oneself? (Part 2)
April 20, 2017
Protection

Purchasing put options or selling call options to protect oneself? (Part 2)

Martin Noël

In the last article, we compared purchasing put options with selling call options. We reached the conclusion that, in the absence of a known target price and timeframe, it is better to use strategies that take advantage of the decaying time value of options, such as selling call options, as protection against a decline in the...

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1 week ago
Purchasing put options or selling call options to protect oneself?
April 11, 2017
Bearish Outlook

Purchasing put options or selling call options to protect oneself?

Martin Noël

Is it better to purchase put options or to sell call options for protection against loss? Many investors ask this question but, in this as in many areas, there is no single right answer. As we have seen in earlier articles, purchasing options has one major disadvantage: the erosion of the time value that must be counterbalanced...

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2 weeks ago
Peak Optimism Weighing on Canadian Banks
April 05, 2017
Risk Management

Peak Optimism Weighing on Canadian Banks

Patrick Ceresna

Reflecting on the last 9 months, we can decisively identify the global reflation trade as the primary driver of the equity rally.  This was considerably accelerated by the Republican sweep in the U.S. elections driven by expectations of new growth driven by tax cuts and fiscal spending.  During that roaring bull advance, it...

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3 weeks ago
Add (ONEX)tra upside without putting on extra downside
April 05, 2017
Bullish Outlook

Add (ONEX)tra upside without putting on extra downside

Christopher Thom

Onex is a stock that has done very well over the long term. Since going public in 1996, the stock has had an annualized total return over 16%.  The company places emphasis on managers owning stock and investing alongside shareholders – this is something I like to look for when investing in a company.  For an investor...

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3 weeks ago
The Greeks – Vega
April 05, 2017
Concepts

The Greeks – Vega

Martin Noël

This week, we will look at another Greek variable, called vega. Vega measures the amount that an option contract’s price changes in response to a change in the volatility of the underlying asset. You will recall that an option’s time value is influenced by the time remaining until expiration and by the implied volatility of...

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3 weeks ago
Portfolio Diversifiers
March 30, 2017
Stock Options

Portfolio Diversifiers

Richard Croft

I assume that all investors understand the value of diversification. It is all about developing a long-term portfolio strategy that will deliver performance within a tolerable level of risk. Bonds are typically used as a portfolio diversifier. The fixed rate of interest delivers critical cash flow to the portfolio to offset the...

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4 weeks ago
Understanding Volatility Exchange Traded Products
March 28, 2017
Volatility

Understanding Volatility Exchange Traded Products

Hans Albrecht

Using volatility ETPs is a pure play way to target volatility for your portfolio – no strike risk to worry about.  But make sure you understand the key points below very well before wading in… ——————— I’m often asked about long volatility exchange traded products (ETPs)...

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1 month ago
The Greeks: Theta
March 28, 2017
Concepts

The Greeks: Theta

Martin Noël

This week, we will look at another Greek variable: theta. Theta measures the change in the price of an option following a change in the time remaining to its expiration. You will recall that an option’s premium has two components: intrinsic value and time value. But since an option that has reached expiration has run out of...

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1 month ago