Stock and Options Trading

How do the Strategies Work?

2007-10-30T12:33:00.000-07:00

The trading strategies we offer you have been developed over more than 10 years, through meticulous analysis and refinement of trading techniques. They are fully mechanical. So no emotion or subjectivity is involved.

They are based on technical analysis of market trends and the swings that all stocks go through. Swings that can be traded in BOTH directions for amazing gains!

Using a special set of rules, we select only those stocks that are likely to make big moves, and therefore give us big returns.We've taken away the need for all the complexities of analysis. Our years of experience have allowed us to boil things down to the few key indicator numbers that are important for trading.

Applying these numbers to our selected securities gives us the measure of the extent that we expect each security to move. And that in turn gives us the precise risk, target and reversal points for the trades.

Direction doesn't matter!

The beauty of it is that the direction of the move is not important! Our trading strategies are looking for good moves, but it doesn't matter which way - up or down - we get great results.In summary, our trading strategies are quite simple:

- We select only the big movers!
- We determine the extent of the expected move!
- We trade that big move in either (or both) directions. No need to try and guess which way it's going to go!

And... EXTREMELY SUCCESSFUL!
How would you like to have made over 240% so far this year?

So take your No-Commitment 2 WEEK FREE TRIAL here:
http://www.intradaytrades.com/idt3.html

Another Day of Great Trading

2007-08-30T20:05:00.000-07:00

We had another great day with our IntradayTrades Day Trading Strategy.

A total return of over 18% with the 6 stock picks we made today!!

The trade above is just one of those picks.
Our system carefully selects those stocks that are likely to make big moves, and then using intraday swing trading and reversals, we take advantage of those moves to make big trading returns.
And it doesn't matter what the initial direction of the move is. In this case the initial move was upwards. And so the system triggered our BUY setup (but it would have triggered our SHORT setup had it gone down).

This trade on the JASO stock made a total return of almost 8%!

Learn more about how our strategies work and see our results.
We offer a 2 Week Free Trial: http://www.intradaytrades.com/idt3.html

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Day Trading - 36% Return on one trade!

2007-08-19T17:35:00.000-07:00

Stock Pick of the Day - August 15th, 2007

If you're struggling to figure out how to trade the current volatile markets, take a look at our trading strategies.

Our Day Trading Strategy is up over 27% in August (and hasn't had a single losing day this month!)

Here's a great example of the true power of our Day Trading Strategy.
This is a trade we made on KKR Financial Holdings LLC (KFN) on Aug 15th.

You'll see that because our strategy uses reversals, it doesn't rely on trying to guess the direction of the move.
It simply takes advantage of any and all big moves.

Here the strategy initially went Long on the trade. It didn't move very far in that direction and so a reversal was triggered (for a small loss of just over 3%).

But then.... we made over 23% going short
And another 16% going long again.

For a total return of over 36% on a single trade!!

So, while so many traders are worried about what the markets are doing and how to trade them, our strategies are thriving, making amazing returns on the large moves these market conditions are offering up.

Take a Free Trial and see how you can make great returns too:
http://www.intradaytrades.com/idt3.html

The Art of Hedging with Options

2007-08-18T11:42:00.000-07:00

A hedge is an investment made to offset the risk incurred by entering another investment. Essentially you are setting up a bet on both sides so that one offsets the other and you can end up winning either way.
Think of it as a form of insurance.

Options are frequently used in hedging.

For example, you can speculate that the market price will rise in the future and buy a call today. But, because the market is uncertain and you're not certain it will rise, you simultaneously buy a put option. By carefully selecting the appropriate combinations of strike price, expiration date and type of option an investor can minimize risk and maximize the probability of making a profit.

So how does it all work?

Well let's take a look at a common hedging strategy: the Strangle.

In this strategy, an investor holds both call and put options with the same maturity, but with different strike prices.
The contracts are purchased 'out of the money' and are therefore cheaper. 'Out of the money' means the strike price of the underlying asset is higher (for a call) or lower (for a put) than the current market price.

For example let's say Intel (INTC) is currently trading at $40 per share. You could buy one call at $3 and one put at $2 with the call having a strike price of $45, the put $35. Your total investment would be ($3 x 100) + ($2 x 100) = $500.

If the price over the length of the contracts stays between $35 and $45 the total possible loss = $500, the cost of the options. So your risk in this kind of hedge is limited to $500.

Suppose the price drops near expiration to $25. The call would expire worthless, but the put is worth ($35-$25) x 100 = $1000 - ($2 x 100) = $800. Subtract the cost of the call, $800 - $300 = $500. So that's your net profit (ignoring commissions and taxes).

The difference between the exposure and the potential profit represents a kind of hedge.

Though you are essentially 'betting' that the price could go either way, your downside is limited to the combined cost of the put and the call.

There are, not surprisingly, nearly as many hedging strategies as there are investors.

A couple of common types are:

The collar: Hold the underlying asset and simultaneously both buy a put and sell a call of the same asset. The short call limits gains, but the long put hedges against any losses from the underlying asset.

The protective put: Buy the asset and also buy a put option on the same asset. At expiration, the asset may have gained (eliminating the value of the put option), but the rise in the asset offsets the loss.

And there are a whole host of other variations. Most do involve speculating on the price direction of the underlying asset, while taking advantage of the leverage, cost and timing characteristics of options.

As with any investment strategy, make sure you understand the pros and cons before laying down your bet.

For a Free Trial of our Trading strategies please visit: http://www.intradaytrades.com/idt3.html

How to Profit from a Market Correction: Diversified Trading Strategies

2007-08-14T15:48:00.000-07:00

What happened to the stock markets in early March?

Anyone at all involved in investing or trading no doubt personally experienced it- the stock markets went through a major correction! And in these days of the "World Economy" such a correction can be triggered by news from anywhere in the world. As it did this time. Poor economic news from China prompted a sharp world decline in stock prices in just a few days.And many investors, especially long term investors made big losses.

And they're probably asking: "Is there some way I could have avoided making losses during that period?"
Well, the answer is absolutely Yes.

Obviously trying to predict such a correction and get out before it happens is extremely difficult, and honestly more a matter of luck than anything else.But by diversifying your trading strategies you can definitely avoid losses during such times - and in fact make healthy profits instead!

The key is to employ a mix of trading techniques that take advantage of a variety of trading timeframes.

Avoid putting all your eggs in the "long term" basket and look at complementing your trading with styles that make returns over the shorter term as well:
- Swing trading is an excellent way to capitalize on market movements over a period of just a few days or weeks.
- Day trading of course, allows you to make returns on stock movements within just one day.

And, mix up how and what you trade:
- Include Short Selling in your trading techniques. By selling a stock or index short, you are looking to profit from downward moves. This is just as valid as trying to buy low and sell high. And offers an important hedge against a market correction
- Also, there are now Inverse and even Double-Inverse indices that can be traded quite easily. DOG is the symbol for the Inverse Dow 30 Index and DXD is the Double Inverse Dow 30. By owning these, you are essentially short selling the major stock indices.

And, contrary to popular belief, it is not difficult to begin trading in this manner.Over the years online trading has exploded in popularity and, as a result, the resources, tools, strategies and infrastructure available to the ordinary investor have become enormous.
- Online brokers offer trading accounts with extremely low commissions that allow investors to trade all kinds of different instruments (stocks, options, futures, forex) over all kinds of different timeframes (day trading, swing trading, long term trading).
- A large number of trading strategies and systems are also available online. And many such systems, like http://www.intradaytrades.com/ , for example, offer a spectrum of short term and longer term strategies in a single service.
- And online trading platforms have become very sophisticated, offering complex analysis tools and even the ability to develop and back test trading strategies.

So, what simple steps can you take to profit during rising markets AND market corrections?
- Long Term trading: Allocate a portion of your trading funds to long term investments (over many months). Make your profits from the overall market trends - remember to take those profits periodically so that you're not caught by a sudden downturn. And look to include some of those Inverse Indices in your portfolio. They can act as a tremendous hedge against market corrections.
- Medium Term trading: Allocate a portion of your trading funds to Swing Trading. In this way you capitalize on the medium term trends in the markets or individual stocks. Practically all financial instruments go through these medium term swings as traders are constantly trying to determine the right longer term price by buying and selling at support and resistance levels. And by taking both Long and Short trades on these swings you stand to profit in both directions!
- Short Term trading: Allocate a portion of your trading funds to Day Trading. This allows you to completely take the longer term market factors out of the equation. By trading within a single day, it really doesn't matter that there was a long term correction. You profit anyway. With the right strategy, you would undoubtedly recognize the selling opportunity presented on the day(s) when there is a market correction. And by selling short you stand to make enormous gains that day!
- Ask your broker how to set up an account that allows you do trade in this way. You'll be surprised at how simple it can be to get setup.

Much is written about diversifying your investments. But don't just look at diversifying your holdings. Diversify your trading strategies too.

Free Trial - Stock and Options DayTrading and Swing Trading Service: http://www.intradaytrades.com/idt3.html

Day Trading Strategy Making Big Returns

2007-08-08T18:13:00.001-07:00

See how our Intradaytrades Day Trading Strategy can keep making great returns!

Here are our results from today's trades.

5 winners!
And over 20% total gain on the 5 stocks we traded....

Day Trading - Trade of the Day - April 30th

2007-05-01T11:45:00.000-07:00

Trade of the Day for April 30th 2007

Another great trade from our IntradayTrades Day Trading strategy!

This was a trade with the stock ROCM. Our long entry was triggered at 23.20, and reached the high of the day before reversing for a 6.68% Gain going long. Then our system indicated that we should reverse to short at 24.75 and we rode it all the way down again to 23.05 before it started turning up again. We exited at 23.75 for another 4.04% Gain going short.

The net result was a total gain of 10.72%!

Take a 2 week Free Trial of our trading service here: http://www.intradaytrades.com/idt3.html

Day Trading System - Stock Pick of the Day!

2007-04-04T11:24:00.000-07:00

Trade of the Day for April 3rd 2007

Here's an example from our IntradayTrades Day Trading Strategy where we didn't have to make any reversals.
In this case we were trading the stock GROW.
Our long entry was triggered, and the stock simply continued on a strong upward trend through the day.
We exited at the end of the day and made a healthy 6.15% gain!

Take a 2 week Free Trial of our trading service here: http://www.intradaytrades.com/idt3.html

Options Trading 101

2007-03-18T12:45:00.000-07:00

The individual investor will typically include some stocks in their investment portfolio. And whether they are a long term trader or in it for much quicker returns, many investors understand and feel somewhat comfortable with the concepts and techniques of trading stocks.
Options tend to be much less understood - and therefore avoided.

But Options can form an extremely valuable part of your trading strategy as they can provide tremendous returns!

So here I will try and give you some of the fundamental concepts behind trading options.
Options are a contract conferring the right to buy (a call option) or sell (a put option) some underlying instrument, such as a stock or bond, at a predetermined price (the strike price) on or before a preset date (the expiration date).

Options officially expire on the Saturday after the third Friday of the contract's expiration month but because the markets are typically closed on Saturdays, the Friday is commonly used as the expiration date.

A key concept to grasp is that, when you buy an option, you don't actually own the underlying security. You simply own the right to buy (or sell) at a specific point in time. But, of course, the price of the underlying instrument and the time remaing before expiration both affect the value of the option.

So in trading options you have two main ways to make money on them:- You can hold to maturity and then exercise the option (with the hope that the underlying instrument is then worth more than what you are entitled to buy it at - your "strike price")- You can sell the option itself prior to expiration (in the hope that the value of the option itself has risen above what you paid for it)

A great many investors do in fact hold until maturity and then exercise the option to trade the underlying asset. Assume the buyer purchased a call option at $3 on a stock with a strike price of $30. (Typically, options contracts are on 100 share lots.) To purchase the stock the total investment is:

($3 + $30) x 100 = $3300 (Ignoring commissions.)

So if, at expiration, the stock is worth more than $33 you've made a profit (You can sell your 100 shares for more than $3300 right away).

Speculating on the actual value of the option itself is the second alternative.Let's use the same example above.

You bought your options for $3 with a strike price of $30.

If the price of the underlying stock goes above $33 at any time prior to expiration, then naturally more people will want to try and get a hold of that option you own, because they see a high likelihood of making a profit off the underlying security. So, with the increased demand for that option, the value of the option itself will likely go up. So you can sell the option to that higher bidder for a profit.

For example, if the price of the underlying stock rose to, say $35 then the option itself may becoming worth, say $4 on the open market. So you sell your options for $4 and make a nice 33% return. Without ever having owned the underlying stock itself.

Those are the kinds of returns that make options so attractive.

Many brokers offer trading accounts to individual investors that allow options trading and frequently at very competitive commision rates.It really isn't very difficult to get started.
Options trading is risky, so manage your risk and your assets wisely and only use a small percentage of your overall portfolio for trading options.

But do consider them as an additional component of your investment strategy, as they can yield tremendous returns when traded correctly.

Take a Free Trial of our Trading Strategies: http://www.intradaytrades.com/idt3.html

Day Trading - Stock Pick of the Day

2007-03-13T12:40:00.000-07:00

Trade of the Day for March 13th, 2007

Today we made 7.03% Trading the stock Lend in our IntradayTrades Day Trading Strategy
Take a 2 week Free Trial of our trading service here: http://www.intradaytrades.com/idt3.html

Day Trading Strategy - Trade of the Day!

2007-03-12T15:44:00.000-07:00

Trade of the Day for March 12th, 2007
Today we made 6.00% Trading the stock TSL in our IntradayTrades Day Trading Strategy

In this trade we did make a small loss after the initial entry triggered going Short.

But the stock moved up nicely in the middle of the day and we caught that move with our reversal to Long.

Take a 2 week Free Trial of our trading service here: http://www.intradaytrades.com/idt3.html

Understanding Options

2007-03-10T14:51:00.000-08:00

Options trading is extremely popular and provides much greater possible returns that does trading in the underlying stocks. But it also carries more risk.

So it is extremely important to understand how options work as financial instruments and be clear on what your potential risk and rewards are in trading them.
Options are contracts on some underlying trading instrument - shares of stock, bonds, a commodity, even a mortgage loan!

Stock options are the ones most people are familiar with and are the most traded by individual investors.
But regardless of what the option is on, there are common features. One of the most basic is the contract feature specifying what the option owner has actually contracted for.

There are two types of Option Contracts: CALLs and PUTs.

CALLs
A 'call' confers on the (option) contract holder the right to buy an asset at a stated price on or before a specified expiration date. An option to buy, but not an obligation. That's why it's called an option!

The owner also has the option to let his contract expire. But then he loses everything he invested in buying that contract.
Essentially, when buying a Call option, you are betting that underlying asset will increase in price before the expiration date. And, not only rise, but rise enough to make a profit.
But whether you make a profit is determined by the price you paid for the option, and the increase in price of the underlying asset.

Clearly the price must rise enough to cover the difference between the market price and the price at which you can buy the security (the strike price of the option contract). And, since the option itself has a cost, the price has to rise enough to cover that additional amount. That cost is called 'the premium'.

The cost of the option fluctuates with the supply and demand for that contract on the open market. Several factors determine the premium, including the price of the underlying asset, the strike price of the option, the time remaining on the option, and others.

The time remaining is particularly important. Naturally as the option contract nears its expiry date the price of the underlying asset (the stock for example) is less likely to change dramatically from its current price. Therefore the result of excersizing the option is known with more certainty and the cost of the option reflects that outcome. For example, if a Call option is nearing its expiry date and the value of the underlying asset is lower than the strike price of the option the option is practically worthless, and so its cost will be very low.

Suppose it's June 1, for example, and Intel (INTC) has a market price of $27. Call options for Sept 30 are selling for $3 with a strike price of $30. You buy one contract for 100 shares.

So, if you held until expiration you either lose $300 ($3 x 100, the initial price of the contract not including commission), or buy the underlying stock at $30. If the current market price were $35 you've made $200. ($35 - ($30+$3) = $2 per share x 100 shares, ignoring commissions.)
When the market price of a share is above the strike price, the option holder is 'in the money'. If the market price is lower, he's 'out of the money'.

PUTs
A 'put', by contrast, gives the option buyer the option to sell an asset at a certain price by a stated date. The option, not the obligation.
Puts are similar to 'shorting stock', in this sense. Put buyers are betting the stock price will fall before the option expires.

In this case the market price must fall below the strike price in order to garner a profit from exercising the option. (Ignoring the cost of the put, for simplicity.) Under those circumstances, the option holder is 'in the money'.

For example, take the same situation as above but let the option be a put. If the market price falls to, say $25, your profit would be:

First, $3 x 100 = $300 = Cost of put, excluding commissions.

Then, buy 100 shares at $25 per share = $2,500 to repay broker 'loan' (since shorting stock involves borrowing shares you don't own, then repaying later).

Finally, sell 100 shares at Strike price = $30, 100 x $30 = $3,000

Therefore, your profit = ($3000 - $2500) - ($300) = $200.
(Actually, the broker takes care of all the underlying mechanics. The investor merely orders the trades at a given time and date.)

Whether investing in calls or puts, wise investors do the needed homework. Options trading is risky and somewhat more complicated than simple stock trading.
Study the history, volatility, and other factors of both the option contract and the underlying asset. Blindly throwing darts at a board is the best strategy for losing money.

Free Trial of our Trading Strategies: http://www.intradaytrades.com/idt3.html

Day Trading - Trade of the Day!

2007-03-09T13:20:00.000-08:00

Trade of the Day for March 9th, 2007

Today we made 5.03% Trading the stock MLNX in our IntradayTrades Day Trading Strategy

Take a 2 week Free Trial of our trading service here: http://www.intradaytrades.com/idt3.html