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Casual Articles - Why Stock Is More Risky Than Options!
I want you to imagine a lemon. In your mind's eye, see its yellow skin. Imagine cutting it in half with a knife. Now pick up the one lemon half and bring it up to your mouth and suck on the juices.Do you notice how sharp the tangy lemon juice could be? Does it make you pucker? Do you notice how your mouth is watering?...Good!Now you realize the power of words!See, one thing I was good at i
You see, when you short a stock, you actually sell a stock that you don’t own. And your intention is to then buy the sto
The only reason a great many American families don't own an elephant is that they have never been offered an elephant for a dollar down and easy weekly payments. Mad MagazineThe above quote is so true for a lot of us. How many of us have things in our homes that we bought because it was a good bargain and we could get it with credit cards? I raise my hand and now I'm trying to get my bil
Well, what is the truth?
Let’s take a look at stock ownership. What can happen if you buy stock?
The price can go up.
The price can go down.
The price can go sideways.
In the first case, you can make money. In the second you lose money.
And in the third case you don’t directly win or lose but in fact it costs you money in two ways. The direct cost of brokerage and fees. And the indirect cost known as opportunity cost.
This is the cost due to lost opportunities. The fact that you aren’t able to be involved in other, potentially profitable trades.
So if you purchase stock you can only make money if the stock price goes up.
Now some of you may be thinking, “But what about shorting?”
Well yes, short selling stock is possible but it is quite a tricky strategy and has almost unlimited risk so it is certainly not an approach we recommend.
You see, when you short a stock, you actually sell a stock that you don’t own. And your intention is to then buy the sto
We have come a long way from the time when only professionals could replicate CDs and DVDs. With the advent of blank media and the technology to duplicate it or burn it, almost anyone can now make their own CD. The ability to place digital media on a disc has changed how we both use and view this type of media today. It has taken only a few years for CDs to take over the spot once exclusively held by cassettes. Video
The price can go down.
The price can go sideways.
In the first case, you can make money. In the second you lose money.
And in the third case you don’t directly win or lose but in fact it costs you money in two ways. The direct cost of brokerage and fees. And the indirect cost known as opportunity cost.
This is the cost due to lost opportunities. The fact that you aren’t able to be involved in other, potentially profitable trades.
So if you purchase stock you can only make money if the stock price goes up.
Now some of you may be thinking, “But what about shorting?”
Well yes, short selling stock is possible but it is quite a tricky strategy and has almost unlimited risk so it is certainly not an approach we recommend.
You see, when you short a stock, you actually sell a stock that you don’t own. And your intention is to then buy the sto
We have already introduced the concept of forex education and what to look for in part 1 of this article.Here we are going to show you how to educate yourself for free and build your own trading system to build profits.Let’s look at the basic concepts of forex education and how they apply to building a method for free.Let’s start with the basics of a good trading system.1. The big profits
This is the cost due to lost opportunities. The fact that you aren’t able to be involved in other, potentially profitable trades.
So if you purchase stock you can only make money if the stock price goes up.
Now some of you may be thinking, “But what about shorting?”
Well yes, short selling stock is possible but it is quite a tricky strategy and has almost unlimited risk so it is certainly not an approach we recommend.
You see, when you short a stock, you actually sell a stock that you don’t own. And your intention is to then buy the sto
Earnings conference calls are the means of companies to communicate information to all those that are concerned. These concerned parties include investors that are either institutional or merely individual. Earnings conference calls permit businesses to magnify their reached success and provide composure when the company experience trouble. Oftentimes, these earnings conference calls are held right after the dissemin
So if you purchase stock you can only make money if the stock price goes up.
Now some of you may be thinking, “But what about shorting?”
Well yes, short selling stock is possible but it is quite a tricky strategy and has almost unlimited risk so it is certainly not an approach we recommend.
You see, when you short a stock, you actually sell a stock that you don’t own. And your intention is to then buy the sto
We all want to trust that what we read is true, authentic, and genuine, but often the printed word is backed up by paying sponsors who control the spin. For that reason, the magazine Consumer Reports came out many years ago, to provide trustworthy critiques of consumer products within the hype and bias. Even Consumer Reports has to fight to keep its own reputation as an objective magazine, because so many readers are
You see, when you short a stock, you actually sell a stock that you don’t own. And your intention is to then buy the stock back at a lower price. The price difference is your profit per share.
But can you see what the problem is here?
Well what happens if the stock price goes up? Particularly if it goes up a lot?
As you have sold the stock at a lower price you now have to buy it back at a higher price. And so your loss can be substantial.
So, to summarize, when you trade stock you can really only make money if the price increases.
Now there is one other aspect to this that I want to address. And this is that owning stock is expensive!
If you purchase 100 shares of a $50 stock it will cost you $5000. And if you buy it on margin it is still $2500.
That is a lot of money to outlay. And, more importantly it is a lot of money to put at risk. Especially seeing that you only have a one in three chance of the stock moving in the right direction.
Plus as stocks don’t trend all th
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