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Playing Markets

Bear Put Spread

An options trading strategy used by a bearish investor to maximize profit and minimize loss.  When the trader expects the decline of a security or...

“Greeks”

A way of understanding the risk exposures related to an option or a book of options.  Options traders will refer to the delta, gamma, vega, and...

Howie Test

A determination set by the Supreme Court of the United States in 1946 that determines what qualifies as an "investment contract" and thus would be...

Gamma

The first derivative of delta that is used to try and gauge the price movement of an option relative to the amount is it in out out of the money...

Futures Market

An exchange where futures contracts are traded by participants.  Today, the majority of futures trading (or derivatives contracts that lock in...

Demand Pull Inflation

An overall increase in the cost of living that occurs when demand outpaces the available supply of a consumer good.  This form of inflation is a key...

Delta

One of four major risk measures used by options traders (the others being gamma, theta, and vega).  Within options trading, delta is a ratio...

Consumer Price Index

The measuring of the average change in prices over time for consumers buying a basket of goods and services.  It is the most widely used measure of...

Covered Call

A popular options trading strategy to generate income through options premiums.  To execute this call, an investor holds a long position in an asset...

Cost Push Inflation

A type of inflation that occurs when the demand for a commodity remains constant yet the cost of production is rising.  This pushes the burden for...

Annuity

Contracts issued and distributed by financial institutions in which the funds are invested with the goal of returning fixed payments at a later...

Wyckoff

A 5-step method for market analysis and decision making developed by Richard D. Wyckoff in the 1930s.  The 5 steps of the method are as follows: 1....