Archive for January, 2009

Call options: What are they and how they obligate you

Date Wednesday, January 28th, 2009

Many people struggles with the ideas of buying and selling options, although it is not a really difficult subjects to understand, it does requires more efforts to understand the subject thoroughly. It is therefore my objective that you can understand this wonderful financial instruments well and use it to your benefits.

The basic of trading in options, you must understand that when you buy an option, you have the rights to something from someone but when you sell an options you now no longer have the rights but now you are under obligation to deliver something to someone. Read the rest of this entry »

Understanding the stock market’s effect on private stock investment

Date Tuesday, January 20th, 2009

There are a few very essential ideas that you must understand before you consider investing in the stock market. If you do not understand these ideas or do not know of their existence, then you are already at a disadvantage. The following list is what you must always keep in mind when trading/ investing/ whatever you call it.

1. The stock market is controlled by two emotions: Greed and Fear (If it feels like you have heard this before, it’s because it is true and not because people keep copying what others say.) Greed can cause you to wipe away any chance at profit or simply reduce the possible profits you had at one point. The same can be said with fear. It will cause you to sell for a loss, sell too early, and stay on the sidelines for too long. I’ve fallen victim to both of these multiple times. I hope I have learned my lesson by now, but hope is not something you should use when investing. Read the rest of this entry »