Understanding options pricing is crucial for traders seeking to navigate the complexities of the market. In this article, we’ll break down key factors like time value, implied volatility, and intrinsic value to help demystify how options are priced. Whether you’re a novice or an experienced trader, grasping these concepts will significantly improve your ability to … Read more
In today’s market, sector rotation is playing a key role in driving the broader rally. Healthy rotations in sectors help push the market to new highs and create opportunities for investors. Recently, we’ve seen certain sectors surge to new all-time highs, while others have struggled. Understanding this shift is crucial to identifying potential winners and … Read more
Many investors miss out on huge returns because they miss key strategies and insights. Knowing how to find the best-performing stocks, how to use research, and how to apply advanced trading techniques can really multiply returns. This article explores why most investors miss out and how to avoid these mistakes with examples from standout stocks … Read more
Covered calls are one of the most popular strategies to get steady income in options trading, but most investors do not make the most out of it or even end up making avoidable mistakes. This guide will uncover some key insights into selling covered calls effectively, managing risk, and ensuring your strategy lines up with … Read more
Investors who aim to build wealth need to be aware of how various asset classes perform over the long run. That said, too many of them fail to recognize or factor in historical trends and/or diversification into their allocation. The following five-asset class analysis outlines the performance history of stocks, bonds, gold, real estate, and … Read more
The ultimate goal in trading is to come up with a strategy that would constantly yield profits. However, many traders succumb to the temptation of curve fitting—a practice that fits a strategy perfectly to historical data but fails in live markets. This common pitfall leads to failed trades, wasted time, and emotional distress. Curve fitting … Read more
Short-term momentum versus reversals of large-cap stocks are very controversial and debatable topics within financial research. Traditional theories of momentum and reversals basically explain them as sequential phenomena that take place within different horizons of time. However, they really do not talk about these phenomena being combined within one asset category in comparable periods of … Read more
The RVI is a technical indicator of the momentum of prices by comparing the closing price of an asset to its trading range. It reflects the strength of a trend because it analyzes if the price closes higher or lower than it opens. In an uptrend, for example, prices tend to close higher than they … Read more
The cryptocurrency market is inherently unstable, making navigation for traders and investors impossible. Thus, understanding price behaviors, especially in the aftermath of abnormal returns, can help in strategy formulation to get profitable strategies. The first of its kind groundbreaking study is introducing “Momentum Effects in the Cryptocurrency Market After One-Day Abnormal Returns” by Googly Elmo, … Read more
Delta is the measure of the correlation between the option price and the movement in the price of the underlying. It’s a value between -1 and 1, indicating how much an option’s price will change for every $1 change in the underlying stock price. For instance, an option with a Delta of 0.80 implies that … Read more