British Pound is known to be a stable currency. Great Britain is a strong economy. But, Great Britain was finding it difficult to stay within the tight exchange rate band set by the European Monetary Union (EMU) in the early’90s. One person who made history with options was George Soros who is famously known as the man who broke the Bank of England.

George Soros had this intuition that the Bank of England would be forced to devalue British Pound. So he bought call options on German Marks and put options on British Pound. He made a bet of $10 Billion by leveraging all the assets in his hedge fund.

Bank of England had made a number of public statements regarding its intention of staying within the EMU. However, within a few days of the speculative attack on the British Pound, Bank of England was brought to its knees as it was …

Do you know how to read Point and figure charts? Point and figure trading in many ways is similar to the support and resistance breakout trading on bar or candlestick charts. The main difference is the look and functionality of the price charts themselves!

Bar charts and candlestick charts show the high low open and close price for a given period. Point and figure charts represent price in a radically different manner from the more familiar bar and candlestick charts. Many forex charting platforms provide the option of point and figure charts.

Point and figure charts do not show any timeframe. This may confuse you in the beginning. Point and figure charts are a pure price action play because these charts generally exclude all other elements like time, volume and open/close other than price. Point and figure trading is based exclusively on price action.

Point and figure charts represent clear evidence of such …

by Maclin Vestor

A covered call strategy within a cycle will require people to sell options against the stock. If the stock is above the strike price, the stock will be “called” away. The seller receives the premium, but the owner of the call receives the shares at the strike price. There are various strategies involving this covered call strategy.

Some people prefer to have the covered call eventually pay back the stock owner his investment, so that he or she can reinvest that money, and upon receiving the investment back, the person will let the stock run. If this is the strategy, ideally you want to sell covered calls as the stock falls, as it stays flat, and then you want to have your cash back and let the stock run when it is on its way up again. This can allow you to buy an out of favor …

Many websites and e-books on investment training strategies promise you incredible things. Writing Covered call options on stock is one of the most popular trading strategies taught today. These websites promise that you can earn up to 10% monthly returns using that very strategy. Sound good? Read on.

Under the right circumstances, impressive monthly returns can be achieved by selling out-of-the-money covered call options. This strategy has been successfully used by me. However, it is not without its disadvantages. The public has not been properly educated by the website and e-book marketers. This strategy is marketed as having low risk and being conservative. They leave you holding the bag when it all goes wrong.

When the stock market is rising in value selling out of the money covered calls works well. Additionally, when the stock market is neutral (not going up or down …

by Marc Abrams

Incredible things have been promised by many websites and e-books regarding investment training strategies. One of the more common stock market trading strategies taught is to sell covered call options on stocks. These websites promise that you can earn up to 10% monthly returns using that very strategy. Sound good? Read on.

Under the right circumstances, impressive monthly returns can be achieved by selling out-of-the-money covered call options. This strategy has been successfully used by me. However, it is not without its disadvantages. The public has not been properly educated by the website and e-book marketers. This strategy is marketed as having low risk and being conservative. They leave you holding the bag when it all goes wrong.

Selling out-of-the-money covered calls works when the stock market is going up in value. Additionally, when the stock market is neutral …

by William Davies

Global commodity trading now takes place on a growing platform of modern, transparent commodity exchanges across all time zones. Using agreed frameworks of rules and regulations and standard contract designs we now see a wide range of commodities traded between end users and primary producers. The result is that it is now much easier to buy and sell across the range of basic commodities from orange juice to gold bullion, from crude oil to coffee beans.

While some of the major commodities like coffee and crude oil have been traded for a number of years, we are now seeing in modern commodity markets the strong innovation theme leading to new futures contracts being traded. One area where new product development has made a notable change is in the trading of carbon emission permits. Given the growing global concern about the serious long term impact to the environment …

by Brevan Glg

Global macro traders thrive off of risk. In fact most traders do as without risk there is no reward. That being said one of the most important things that a trader can do is to incorporate several levels of risk management into their trading process. Lucky for us there are about a gazillion different ways to try and mitigate and at times virtually eliminate risk.

One of the first and most important risk management tools available to the macro trader is the practice of positions sizing. Position sizing is when you determine an optimal amount to risk on a trade. Obviously several factors can go into your position sizing algorithm. You can look at the probability of the trade working out. You can look at the over all risk versus reward ratio. And you can look at how much of your portfolio you want to risk. Obviously …

Vanda Pharma (VNDA) and Titan Pharma (TTP) are a pair of biotech blow-ups which investors should avoid ahead of a July 27, 2008, PDUFA decision date for anti-psychotic drug Fanapta (iloperidone). Both stocks have lost about two-thirds of their market value over the last year and are down sharply recently on pipeline clinical trial failures. I don’t think the FDA will approve Fanapta as the anti-psychotic space already has plenty of similar options and thec agency is cracking down on the widespread, off-label use of these drugs in elderly patients.

In the CNBC.com video “Go Short” how does Options University strategist Ron Ianieri define a “speculator”?

“Everyone who is in the market.”

In “What Options are Saying about Lehman” Rebecca Darst said “the question…on everyone’s lips” is whether there is a

“The question, I think, on everyone’s lips is whether we’re seeing a Bear Stearns-like setup in Lehman Brothers,” said Rebecca Darst of Interactive Brokers on CNBC’s “Squawk Box.”

I’m still avoiding Lehman Brothers (LEH).