Comments for Singapore Trading Blog

Comment on How to do Options Trading? by OoN

OoN — Tue, 20 Sep 2011 14:38:16 +0000

Look to sell options and only buy LEAPs on any options cos atleast 75% of the time your options will expire worthless. Learn how to manage your greeks and use weeklys and volatility disparity to find opportunities. It can be found every single as stock or futures prices explodes and contracts. If you have to buy ITM or OTM, hedge to lock and increase your profits without risk of loss ..

Comment on Option Basics: A Call Option’s Value by czarnaski

czarnaski — Mon, 06 Jun 2011 07:33:40 +0000

clear and easy, very nice, thank you

Comment on Option Basics: What Are My Options? An Introduction to Option Trading by klayed

klayed — Fri, 13 May 2011 13:30:44 +0000

nice very nice

Comment on Option Basics: Introducing the Long Condor Spread by cavalucho

cavalucho — Tue, 10 May 2011 20:52:16 +0000

Sarah Wasserman is getting anorexic.

Comment on How do I open a Singapore Forex Trading Account? by mkohtm

mkohtm — Mon, 11 Oct 2010 17:32:51 +0000

There are many brokers you can use. I would recommend making sure that the broker you use is not a market maker as their interest will probably not be the same as yours.

A few rules to follow to make sure you don’t lose too much in the beginning especially is not to leverage too much (even if the broker lets you use very high leverage) and to be very disciplined in your trading approach.

Good brokers will often times have someone on staff to help answer some of your questions regarding the markets. Make sure you educate yourself as much as possible.

Make sure you understand all of their fees and interest rates before you open a forex trading account. In addition, it’s important you clearly understand the margin requirements – be careful, some brokers have different margin requirements for the weekends, something which can lead to large losses if you are not aware of it.

Comment on How do I open a Singapore Forex Trading Account? by benlentino

benlentino — Sun, 20 Jun 2010 09:31:07 +0000

During registration with any chosen company, they will explain to you how the procedures work! For the company i’m using provide options of either cheque deposit or electronic banking to their account. And if you are making profit from your account, just email them through the system provided by them and it will transfer to your account within a week.
Let’s say if you are uncomfortable with exposure of your personal bank account numbers, you can always open a new bank account with a minimum deposit for purpose of forex transaction and transfer those profit to your personal account.
As for whatever company you choose, will depend on whether do they provide a good back-up services, a reliable and easy-to-use platform. Personally, i had tried a well established Singapore company, but their back-up services and platform had totally disappointed me. I’m not in a position to comment on Saxobank, as i have not try them. But IG Market, a London based company, really impressed me!
Lastly, before you decided to open an account, try trade with demo account! There are a lot of books in the market provide some useful tips on forex trading. Basically, you need to start with basic understanding of using technical analysis before you know how to use and set-up the platform. Enjoy trading!

Comment on Options trading : What does a buyout do to out of the money calls? by zman492

zman492 — Wed, 09 Jun 2010 04:02:21 +0000

To treat everyone as fairly as possible when a buyout occurs, the existing options are adjusted to require delivery (if execution/assignmnet occurs) of the same thing the owner of 100 shares of the stock received in the buyout. The expiraton date for the option does not change. For examples, see http://www.cboe.com/tradtool/contracts.aspx In your example, if the buyout was for $36 per share the owner of 100 shares would receive $3,600 and your option would give you the right to pay $4,000 to receive $3,600, effectively making the option worthless. Similarly, if the buyout was in stock, say 2 shares of the buying company for each share of the company being bought, the owner of 100 shares would receive 200 shares of the new company so your option would give you the right to buy 200 shares of the new company for $4,000.

Comment on Options trading : What does a buyout do to out of the money calls? by OPM

OPM — Wed, 09 Jun 2010 03:02:52 +0000

In the case of a straight exchange for stock, then a complicated formula occurs and the option continues if the other company is listed on the options exchange. In the case of cash, the option becomes worthless. You could of course, hypothetically, call the stock at 40 and sell at 36, but that would be nuts. If the buying company is a private firm or not listed, the options likely just cancel.

In the case of a cash and stock mix, I think the strike price is reduced by the equivalent amount of cash as a proportion of book value.

Also, in some circumstances, existing contract holders can be required to pony up cash, or take cash to convert contracts back to units of 100 shares.

Generally, option contracts cease trading at the moment of merger announcement and the trading ceases permanently. However, you can still exercise the contract.

You should assume that the contracts will be worthless at the moment of announcement. Since you are so far out of the money, it is reasonable to believe you will never receive anything. If a merger is reasonable at this point, I suspect you will see option prices reflecting this since they are quickly on their way to worthless if approved. A worst case scenario would be a board accepting a cash payment for shares. These contracts would strictly worthless, you could never sell them, and although you could exercise them, it would cost you 400 plus commissions to do it and you would get nothing back.

Comment on How are Options Trade different from Stock Trading? by Michael

Michael — Sat, 05 Jun 2010 19:02:04 +0000

Here are some facts about options: Options are a financial instrument, like stocks and bonds. The most common types are Puts and Calls. Like stocks and bonds they can be bought and sold using a traditional or online stock broker. Options are used in a variety of ways. Examples of their uses are to protect portfolios, to aggressively speculate and to generate income. Options are contracts, that is to say, they give the buyer of options certain rights and the seller certain obligations. Options are valid only for a specified time period. They slowly waste away in value until they expire.

Comment on How are Options Trade different from Stock Trading? by James

James — Sat, 05 Jun 2010 18:51:56 +0000

Options are contracts that follows the price of the underlying stock but takes far lesser money to buy than the underlying stock. That is why you noticed some people make a lot of profit from doing options trade. Thats because being able to control more stocks with lesser money gives you leverage and the ability to make more money from the same move in the stock.

In short, Call options allows you to profit when the stock goes up and put options allows you to profit when the stock goes down. Both kinds of options can also be “shorted” for the reverse effect. This makes options trading extremely versatile with almost countless strategies for hedging and speculation.

The problem with options trading is that options EXPIRE. This means that after some time, if the stock did not move enough to give value to the options, the options simply evaporate and you lose the amount of money you put into it. Thats why so many people say options are risky.

Well, thats just a very very very simplistic overview of options. Options trading is way too big a subject for me to outline here and there are even seminars that teach the basics of options for over $5000! I learnt all my options trading for free at the site below, hope it helps.