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How to Improve Your Odds with Put Ratio Backspreads

Michael Thomsett

Traders tend to view the put ratio backspread as a bear strategy, because it employs puts. However, it is actually a volatility strategy.

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By Michael C. ThomsettDecember 18, 2012
Topics: Finance & Investing

Options: A Holiday Poem

Michael Thomsett

The month is slipping away quickly, so I thought I should hurry up and post my annual holiday options poem. Here it is ...

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By Michael C. ThomsettDecember 12, 2012
Topics: Finance & Investing

Options Trading - the B-S Pricing Model

Michael Thomsett

The big question, of course, is: How can we rely on a formula with a series of variables that are provably inaccurate and based on a flawed assumptions, exponentially inaccurate variables, and outdated models about the nature of options?

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By Michael C. ThomsettDecember 7, 2012
Topics: Finance & Investing

William Shakespeare: A Sonnet about Options?

Michael Thomsett

Did William Shakespeare trade options? -- from ThomsettOptions.com

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By Michael C. ThomsettNovember 2, 2012
Topics: Finance & Investing

Technical analysis - mastering the basics

Michael Thomsett

How do we time trades? Entry and exit may be wise based on circumstances, but timing is the key to making smart moves well-timed moves as well.

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By Michael C. ThomsettOctober 23, 2012
Topics: Finance & Investing

What Are Your Options?

Michael Thomsett

Investors need net returns that match or beat the double effect of inflation and taxes. But they don’t want to have to take on higher risks. This is a dilemma, but there are solutions.

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By Michael C. ThomsettSeptember 17, 2012
Topics: Finance & Investing

Options Trading: The Most Common Risk

Michael Thomsett

Traders hear about all kinds of risk, but one specific type is common to traders at all levels, but rarely if ever discussed.

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By Michael C. ThomsettAugust 28, 2012
Topics: Finance & Investing

Options Trading: Options By the Great Poets?

Michael Thomsett

It may be true that listed options are a somewhat modern oddity. But some quick research has turned up interesting commentary on options trading and, specifically, concerning risks and going short. So William Shakespeare, Edgar Allen Poe and even Ogden Nash added their voices to the unending debate about options trading …

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Options Trading: Mastering the Basics is Never All That Easy

Michael Thomsett

No matter how many years you trade options, you have to continuously re-focus yourself, remember your rules of trading, risk standards, and much more.

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Options trading: The Dividend Collar, An Example

Michael Thomsett

I have been blogging extensively about the risk-free, double-digit returns possible with the dividend collar. Most traders are curious and positive about this, but a few have claimed it will not work. Here is an example of a recent trade on which the dividend collar would have worked profitably - double-digit annualized returns and elimination of market risk.

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Options trading: Risk-free and double digits - is it possible?

Michael Thomsett

Options traders hear a lot of wild promises about the riches you get trading options, but most of these schemes turn out to be a lot of hype and exaggeration. But here is an idea that actually does work.

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Options: Comparison of Risks in Synthetic Stock

Michael Thomsett

The use of offsetting option positions creates "synthetic stock" - the no-cost or low-cost option combination behaves just like stock. The risks in the position, by the way, are the same as those risks in 100 shares, but for much less cash outlay.

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