Investing Articles - Options And Futures

Options And Futures
Here we'll provide you with insight on how options work, how they are useful and why you might consider adding them to your portfolio.
Options and Futures Article Archive

Iron Condors: Wing It To Maximum Profit
Understanding the right way to execute an iron condor can increase potential returns and limit risk.

Tips For Getting Into Futures Trading
The futures markets can seem daunting, but these explanations and strategies will help you trade like a pro.

The Basics Of The Long Ratio Backspread
This option trading strategy allows for unlimited profit potential in a given direction while still providing security.

Top 4 Mistakes That Cause Futures Traders To Fail
Learn to keep your losses to a minimum and consistently produce positive results.

Spreading The Word About Portfolio Margin
An underused opportunity provided in an SEC rule can enhance returns and lower risk for spread traders.

Minimize Risk With The Long Collar
Think your favorite stock is on the way down? This simple option-trading strategy can help you manage your risks without selling the stock.

Setting Profit Traps With Butterfly Spreads
The OTM butterfly spread offers traders three unique advantages, and can lead to consistent profits. Find out how.

An Option Strategy for Trading Market Bottoms
The reverse calendar spreads offers a low-risk trading setup that has profit potential in both directions.

Options Hazards That Can Bruise Your Portfolio
Learn the top three risks and how they can affect you on either side of an options trade.

Understanding Option Pricing
Take advantage of stock movements by getting to know these derivatives.

Reducing Risk With Options
If you want to use leverage to your advantage, you must know how many contracts to buy.

Getting To Know The "Greeks"
Understanding price influences on options positions requires learning delta, theta, vega and gamma.

An Overview Of Commodities Trading
Foresight and careful observation are the keys to trading this market.

The Four Advantages Of Options
Flexible and cost efficient, options are more popular than ever. Find out why.

Price Consolidation And The Long Straddle
With options, the direction of a stock's next major move becomes less important than its magnitude.

Profit From Earnings Surprises With Straddles And Strangles
These option strategies allow traders to play on earnings announcements without taking a side.

Profit On Any Price Change With Long Straddles
In this strategy, traders cash in when the underlying security rises - and when it falls.

Profiting From Stock Declines: Bear Put Spread Vs. Long Put
If you're bearish, you should compare the risk/reward characteristics of these two strategies.

The Midas Touch For Gold Investors
Find some golden opportunities by investing in gold commodities or futures contracts.

Bear Put Spreads: A Roaring Alternative To Short Selling
This strategy allows you to stop chasing losses when you're feeling bearish.

How To Avoid Closing Options Below Intrinsic Value
Find out how to get a better price for your option and increase your trading profits.

Prices Plunging? Buy A Put!
You can make money on a falling stock. Find out how going long on a put can lead to profits.

The ABCs Of Option Volatility
The mystery of options pricing can often be explained by a look at implied volatility (IV).

Stock Option Expiration Cycles
Understanding expiration cycles is just one more way to help you increase your success rate when trading options.

Trading OEX Options: The Risk Of Early Exercise
Exercising early can benefit options traders, but only when trading American-style options.

Putting Collars To Work
Find out which protective or bullish collar will result in your optimal risk/return level.

How To Invest In Commodities
Find out which futures, options, or funds will be your perfect commodity portfolio fit.

Exploring European Options
The ability to exercise only on the expiration date is what sets these options apart.

Greenshoe Options: An IPO's Best Friend
Find out how companies can save or boost their public offering price with these options.

American Options Investors: Should You Go Euro?
These two options have many similar characteristics, but it's the differences that are important.

Selecting A Hot SPOT Option
These options allow investors to have full control over their investments.

Investing Seasonally In The Corn Market
Each month can bring new growth opportunities, if you know where the right investment seeds are.

Managing Interest Rate Risk
Learn which tools you need to manage the risk that comes with changing rates.

Covered Call Strategies For A Falling Market
Find out how to come out on top, even when the market is dropping.

What Is Option Moneyness?
Get the basics under your cap before you get into the game.

Collecting Option Premium In The Grain Market
Believe it or not, there are some great income-generating strategies that are lower in risk.

Should You Flock To Iron Condors?
This market neutral strategy isn't for everyone. Read on to find out if it is for you.

Iron Condors Fly On Fragile Wings
Do the rewards outweigh the risks for this trading strategy? Read on to find out.

Sugar: A Sweet Deal For Investors
From sugar beet to sugar cane, this sector is growing despite a lot of sour challenges.

Trading Calendar Spreads In Grain Markets
Futures investors flock to spreads because they hold true to fundamental market factors.

Harvesting Crop Production Reports
Find out what grain investors need to know to analyze USDA reports.

Pencil In Profits In Any Market With A Calendar Spread
This options spread strategy provides many advantages over plain old puts and calls.

A Guide To Real Estate Derivatives
These instruments provide exposure to the real estate market without having to buy and sell property.

Get A Strong Hold On Profit With Strangles
Forget straddles. These strangles are both liberating and legal in the investing world.

Straddle Strategy A Simple Approach To Market Neutral
Being both short and long has advantages. Find out how to straddle a position to your advantage.

Credit Default Swaps: An Introduction
This derivative can help manage portfolio risk, but it isn't a simple vehicle.

Naked Options Expose You To Risk
Find out why these enticing options can spell trouble for your bottom line.

Get Into Low-Cost Futures Trading With Synthetics
If you can't trade commodity futures outright, these vehicles provide a less expensive alternative.

Are Derivatives Financial "Weapons Of Mass Destruction"?
They've contributed to some major market scandals, but these instruments aren't all bad.

Synthetic Options Provide Real Advantages
Participate in options trading trading that is simpler, less expensive and easier to manage.

Minis Provide Low-Cost Entry To Futures Market
These contracts provide access to commodities without a huge capital commitment.

Forget The Stop, You've Got Options
Using options instead of stop-loss orders adds finesse and control in limiting losses.

Implied Volatility: Buy Low And Sell High
This value is an essential ingredient in the option pricing recipe.

The Basics Of Covered Calls
Learn how this simple options contract can work for you even when your stock isn't.

Your Futures Are In Good Hands With CTAs
Profit from up, down and sideways markets with commodity trading advisors.

Using LEAPS With Collars
This options strategy will help you lock in profit while keeping your upside potential.

Exotic Options: A Getaway From Ordinary Trading
These unusual investment vehicles can reignite your interest in trading.

The Alphabet Soup Of Credit Derivative Indexes
Find out how these instruments work and how they are used in the market.

Hedging In Layman's Terms
This strategy is widely misunderstood, but it's not as complicated as you might think.

Get The Most Out Of Employee Stock Options
These plans can be lucrative for employees - if they know how to avoid unnecessary taxes.

Hedge Fund Failures Illuminate Leverage Pitfalls
Learn why hedge funds collapse and how to avoid making the same mistakes.

Practical And Affordable Hedging Strategies
Discover how to find and use the most cost-effective ways to transfer risk.

Leveraged Investment Showdown
Margin loans, futures and ETF options can all mean better returns, but which should you pick?

Modernize Your Portfolio With ETF Futures
Gain access to premier, highly liquid ETFs with lower capital requirements.

Why Leveraged Investments Sink And How They Can Recover
This powerful tool can have you swimming in money or drowning in underwater equity.

Are Derivatives Safe For Retail Investors?
These vehicles have gotten a bad rap in the press. Find out whether they deserve it.

Take A Tour Of The Futures Trading Pit
Discover why controlled chaos can mean an exciting investment experience for you.

Become An Oil And Gas Futures Detective
Find out how to stay on top of data reports that could cause volatility in these markets.

Cut Down Option Risk With Covered Calls
A good place to start with options is writing these contracts against shares you already own.

Make Better Options Trades
We'll show you how to use the average monthly trading range to score better returns.

Don't Forget Your Protective Collar
Guard your finances in uncertain times with this options strategy.

Understanding Structured Products
Learn a simple way to bring the benefits of derivatives into your portfolio.

Using Options Instead Of Equity
Learn how to multiply returns and diversify risk by buying options instead of stock.

Rolling LEAP Options
Learn how to buy and hold with leverage.

Learn To Corral The Meat Markets
Find out how to trade these hog-wild commodities.

An Introduction To Swaps
Learn how these derivatives work and how companies can benefit from them.

Gamma-Delta Neutral Option Spreads
Find the middle ground between conservative and high-risk options strategies.

Fueling Futures In The Energy Market
These options represent one of the most important political commodities.

Contango Vs. Normal Backwardation
Learn about the futures curve and what its shape means for hedgers and speculators.

Grow Your Finances In The Grain Markets
Hedging with futures can protect those who buy and sell commodities from adverse price movements.

Price Volatility Vs. Leverage
We'll show you how to effectively gauge the risk of the markets you trade.

The Sweet Life Of Soft Markets
Learn the contract specifications for a few of the most heavily traded commodities.

The Dangers Of Options Backdating
This form of executive compensation can pose serious risks for investors.

Money Management Matters In Futures Trading
Learn how this overlooked area of trading can help improve your gains.

Mapping Out The Stock Options Landscape
Find out how to navigate this evolving area of the financial markets.

Adding Alpha Without Adding Risk
Learn how to generate higher returns while keeping the same risk profile.

Trading Gold And Silver Futures Contracts
If you are a hedger or a speculator, this market offers a world of profit-making opportunities.

Surveying Single Stock Futures
These contracts allow for easier shorting, and provide more leverage and flexibility than stocks.

Take Flight With An Iron Condor
This options strategy allows your profits to soar in a sideways market.

An Alternative Covered Call: Adding A Leg
Try this approach to covered calls to increase your potential for profit in any market.

An Alternative Covered Call Options Trading Strategy
This different approach to the covered call write offers less risk and greater potential profit.

Introducing The VIX Options
Discover a new financial instrument that provides great opportunities for both hedging and speculation.

Trading The QQQQ With In-The-Money Put Spreads
Even beginners may use this strategy to trade a bullish outlook.

Volatility - The Birth Of A New Asset Class
Learn more about the trading possibilities with the VIX.

Backspreads: Good News For Breakout Traders
This bullish trading strategy offers unlimited potential profit with limited risk.

A Primer On Managed Futures
Their inverse correlation with stocks and bonds make these alternative investments worth getting to know.

Introduction To Weather Derivatives
Learn about a financial instrument that makes temperature a tradeable commodity.

Managing Bull Put Spreads With A Simple Adjustment Plan
Learn a technique to halt losses when the market moves quickly in an unfavorable direction.

What To Do When Your Trade Goes Awry
Check out some repair strategies to help boost the profit potential of a losing position.

The Price-Volatility Relationship: Avoiding Negative Surprises
Discover how this inverse dynamic has a dual effect on option positions.

Risk Graphs: Visualizing Your Profit Potential
With a single diagram, you can see how price, time and volatility affect potential gains.

Put-Call Parity and Arbitrage Opportunity
Look at trades that are profitable when the value of corresponding puts and calls diverge.

To Limit or Go Naked, That Is the Question
Compare naked strategies to credit spreads and see if the unlimited risk of going naked is worth it.

Corporate Use Of Derivatives For Hedging
We examine various ways in which companies use derivatives to manage risk.

Using the Greeks to Understand Options
These risk-exposure measurements help traders detect how sensitive a specific trade is to price, volatility and time decay.

How Does Your Margin Grow?
Risk-management tool SPAN margin boosts profitability prospects by helping to determine when to exit a trade.

Options Trading Volume And Open Interest
Learn how these two statistics can give you an edge in trading options.

What Are Warrants?
Discover the advantages of this high-return investment tool that's largely unexploited by investors.

Using LEAPS In A Covered Call Write
Discover how strategy can help reduce your downside risk.

Dividends, Interest Rates and Their Effect on Stock Options
Learn how analyzing these variables are crucial to knowing when to exercise early.

Do Option Sellers Have a Trading Edge?
Take a look at a study that discovered that three out of every four options expired worthless.

Getting a VIX on Market Direction
This very useful volatility index of the CBOE tells investors about the mood of the stock market.

Trading A Stock Versus Trading Stock Options - Part Two
Interested in learning more about these derivatives? We go over the factors affecting their price.

Trading A Stock Versus Stock Options - Part One
Interested in learning more about these derivatives? We go over some basic terminology and the source of profits.

Out-Of-The-Money Put Time Spreads
Learn about this low-risk, bearish options strategy used to speculate on major market declines.

Capturing Profits with Position-Delta Neutral Trading
Learn how to gain from a decline in implied volatility with any movement of the underlying.

Going Beyond Simple Delta: Understanding Position Delta
Learn about this hedge ratio, which tells us how many contracts are needed to hedge a position in the underlying.

Ratio Writing: A High-Volatility Options Strategy
Selling a greater number of options than you buy profits from a decline back to average levels of implied volatility.

The Advantages of SPAN Margin
Find out how it provides futures and commodity option strategists with more bang for their margin buck!

Profiting from Time-Value Decay with S&P 500 Options on Futures
Writing bull put credit spreads are not only limited in risk, but can profit from a wider range of market directions.

Becoming Fluent in Options on Futures
There's one simple hurdle in the transition from stock to futures options: learning about product specifications.

Forecasting Market Direction with Put/Call Ratios
Options are not only trading instruments but also predictive tools that can help us gauge the feelings of traders.

Vertical Bull and Bear Credit Spreads
This trading strategy is an excellent limited-risk strategy that can be used with equity as well as commodity and futures options.

Introduction to Put Writing
Learn about a strategy that may be appropriate if you have a positive outlook on a stock.

The Importance of Time Value
Move beyond simply buying calls and puts, and learn how to turn time-value decay into potential profits.

Naked Call Writing
Learn about this aggressive trading strategy that can be used to generate income as part of a diversified portfolio.

Going Long On Calls
Learn how to buy calls and then sell or exercise them to earn a profit.

Married Puts: A Protective Relationship
Learn the basics of this loss-limiting strategy.

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