Im looking for some good advice in stock

[steelback]

Hi im looking for some good advice sites for stock and how to learn more. i found some sites but would like more from someone that are in to it now. the sites i found are good but stock market seems very big and hard so i would like more.mvh steelback

[darquoy]

My advice about stocks would be very simple:
Just do not buy stocks right now - this is much riskiest trading area right now. Everybody's just loosing these days. Trading Currencies exchange is much more interesting, cause you can win when currencies get up AND when they get down...

[chris88]

The best advice is to "buy low - sell high". If you had bought stock in the General Electric Company (Ticker Symbol: GE) in 1962, you would have realized a gain of 4,500% today! ...And you could of written covered calls against the stock throughout the way for monthly income; you do risk selling your stock at each month's strike price, and making money, but potentially losing out on the bigger gain.

Wait for the buy signal in this recession and load up in companies that have accelerating earnings growth and / or new products / services.

[chris88]

Also, you could sell covered puts if you believe the underlying stock is going to decrease moderately, but preferably not below your strike price. Selling covered puts (to open), unlike selling naked puts, requires that you short the underlying stock before you sell your out-of-the-money put. This is a hedge strategy that benefits you in the following ways:

1. Your short sale price of the stock is increased by the money you received from your short put (e.g., $53 short sale with a $2 premium on the put sale increases your short sale price to $55). Your risk of buying back your stock at a higher price than your short sale price (with premiums added) is reduced due to this increase in buffer. You can potentially make money online with this strategy every month while building a larger hedge when you decide to buy-back the shares.

2. If the stock price falls below the exercise price, you will be obligated to buy the stock at the higher exercise price, but still make money off the spread (short sale price minus purchase price); it’s kind of like an insurance policy where your risk against catastrophic drops in share price or outright market collapse is reduced.

Now in comparison, if you sell a naked call (no short stock position), and the underlying stock collapses 75%, for example, you would be required to buy the stock at the exercise price (i.e., 75% higher than market price). Yikes!!!!

Selling covered puts (to open) is also different from selling naked puts, in that, you DO NOT want the underlying stock price to exceed your short sale price. Although the buyer’s put option will expire worthless, you will be held accountable to the margin requirements of the short stock sale. Since you still need to close your short sale position by buying back the stock you borrowed, you will get margin calls and will need to either buy-back some of the stock at the higher price (thereby losing money), deposit more funds, or just plain buy back all the stock shares. This is very critical, as the stock price may continue to rise and you may have to buy back at much higher prices, and thus lose a lot of money, in order to cover your short position.

[chris88]

You could also set up a long straddle or long strangle option play if you don't know the direction of the underlying stock but anticipate a large movement one way or the other.

[chris88]

Oh, then there's the short straddle or short strangle plays where you don't want the stock to move at all in any direction; it could move a little within a narrow range.

[chris88]

How about employing the bull call or bull put spread when you believe the underlying stock will increase in price. These are hedge strategies that reduce your downside risk.

[chris88]

Or conversely, the bear put or bear call spread when you anticipate a decrease in the value of the underlying stock.

[L.Jack]

Hello,
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