A Call Option gives the holder the right, but not the need to purchase a fixed quantity of a particular stock at a specific price inside a particular time. Call Options are bought by investors who anticipate a price increase.
A measurement of the relationship between the price of a stock and the movement of the whole market. An asset has a beta of zero if it moves are not related to the benchmark’s moves. A positive beta means that the asset generally follows the benchmark, in the sense that the asset tends to move up when the benchmark moves up, and the asset tends to move down when the benchmark moves down. A negative beta means that the asset typically moves in the opposite direction as the benchmark: the asset tends to move up when the benchmark moves down, and the asset tends to move down when the benchmark moves up.
The tendency of the stock market to trend higher over time. It can be used to describe either the market as a whole or specific sectors and securities. The opposite of a Bull Market is a Bear Market when the market is moving lower over time.
When an option’s strike price is identical to the price of the security. Both call and put options will be simultaneously “at the money.” For example, if the ABC stock is trading at 75, then the ABC 75 call option is at the money and so is the ABC 75 put option. An at-the-money option has no intrinsic value, but may have time value (value if the stock goes up during the period of the option). Options trading activity tends to be most active when options are at the money.
Technical Analysis is the use of technical indicators comprising of statistics using past market information to predict which direction the security price will move.
Trailing Stop is a Stop Loss order which is placed as a percentage value as opposed to an absolute dollar value. The order will only execute if the price of the security falls by a certain percentage. The trailing stop adjusts automatically as the price of the security rises and bases itself on the new appreciated value. This type of order allows profits to be made while cutting losses simultaneously.
Margin is the amount of money supplied by an investor as a portion of the total funds needed to buy or sell a security, with the balance of required funds loaned to the investor by a broker, dealer, or other lender.
Current Ratio is the ratio of current assets divided by current liabilities. It provides A liquidity ratio that measures a company’s ability to pay short-term obligations. Also known as “liquidity ratio”, “cash asset ratio” and “cash ratio”.
If you have never traded options before, don’t worry; it’s easier than you might think. But before you can even begin trading options, you need to understand what an option is. An option is the right, but not the obligation, to buy or sell whatever the contract was created for.
Through every type of market, William J. O’Neil’s national bestseller How to Make Money in Stocks has shown over 2 million investors the secrets to successful investing. O’Neil’s powerful CAN SLIM Investing System–a proven seven-step process for minimizing risk and maximizing gains–has influenced generations of investors.
A.I.M. Automatic Investment Machine is an Automatic investment Software based on Robert Lichello’s best seller “How to Make $1,000,000 in the Stock Market Automatically” where he teaches his now famous Automatic Investment Management system.
