From the category archives:

Stock Options

Is it Wrong to Hedge Your Own Company’s Shares?

Last year I wrote a somewhat controversial article on how to sell call options against your underlying company stock option grants or restricted stock grants in order to hedge against a potential decline while forfeiting massive upside should the shares take off (see How Options Work if this is Greek to you).  The comments ranged [...]

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Does Switching Wall Street Compensation to Stock Really Decrease Risk-Taking?

With all the public ire over Wall Street compensation and the public inquiry occurring this week demanding the heads of the major Wall Street banks testify (oddly, they’re grilling the heads of firms that survived rather than the ones that failed), one key theme has been Wall Street compensation.
Politicians are grilling executives over compensation and [...]

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25 Best Personal Finance, Investing & Career Posts of 2009

After sharing the best posts from around the blogosphere in Personal Finance and Investing with yesterday’s Carnival of Personal Finance I realized I didn’t do a look-back at 2009 from Darwin’s Finance.  In this list you’ll find thousands of dollars in money saving tips, career boosters, investing tricks and tax deduction ideas you may have [...]

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3 Low-Cost Option Strategies for Stock Market Speculation

While stock market speculation is frowned upon by many main stream investors and journalists, options strategies that seek to exploit market volatility or complacency can reward investors handsomely under the right conditions.  There is a fine line between speculation and hedging though, right?  Airlines hedge their fuel costs (heck, I hedge energy costs for our [...]

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How Stock Options Work Series: Covered Call Writing

Covered Call Option Writing is the subject of this edition in a series on how to trade stock options for income, hedging or pure speculation (see How Stock Options Work: Puts and Calls for intro).  As outlined in my introductory article, a call option grants the holder the right to exercise the option when [...]

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How do Stock Options Work? Trade Calls and Puts – Part 1

Since I routinely post about stock options trading, investing, hedging and income generation and get the occasional question, “How do Stock Options Work?” or “How to Trade Stock Options“, I figured I’d do a series on the various types of stock options strategies out there (they are numerous!) by starting with the most basic stock [...]

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How to Hedge Gas Prices and Put Money Back in your Pocket

What if I told you that you didn’t have to wrestle with skyrocketing gas prices again this summer like 2008?  With oil prices reaching new highs again and gas prices trailing in lockstep, it’s time to think about how to hedge your exposure to increasing fuel prices and save money on gas by whatever means [...]

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Study:Google Earnings Stock Manipulation EVERY Time?

Today, I came across this damning paper from Jerry Liu, a Finance professor at Cal State on the overt manipulation of Google’s share prices around earnings and options expiry timeframes.  Despite occasional grammatical errors throughout, this is the most influential paper of its sort I’ve read in years, including the assigned literature of this sort [...]

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A Lesson in Volatility prior to Earnings Releases: Google Options

For investors that follow the options prices of tech stocks and other volatile companies, they may have noticed that the stock options seem to get “expensive” and “cheap” during certain periods, namely, before and after earnings announcements or other major events.  Since the primary tenant of investing is buy low and sell high, how about [...]

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