Month: January 2021

Trade ideas

Today’s trade idea for option traders: Virtu Financial Inc. (trade closed)

trade idea for option traders

Virtu Financial is one of the leading high-frequency trading companies. Also, it’s one of the biggest market makers and provides liquidity to the financial markets. Making the best money in high volatility environment, Virtu’s stock was swinging sideways since the Corona crash but was beating the earnings estimations of professionals in Q3 2020. Although an analyst of Morgan Stanley downgraded Virtu to underweight on 11th January, option traders might to get an trading opportunity. So let’s check it out.

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Trade ideas

Today’s trade idea for option traders: Workhorse Group Inc. (trade closed)

trade idea for option traders

With the hype for regenerative energies and electric vehicles, Workhorse was one of the profiteers of the rally in this sector. In December 2020, the stock plunged about 22%. The reason for this was that the U.S. Postal Service announced it’s delaying a decision on who will get a contract to build next-generation trucks worth $6 billion for its fleet. On 4th January, on the other hand, Workhorse announced that it had received an order for 6,320 C-Series electric delivery vehicles from Pride Group Enterprises, a Canadian and U.S. based company with businesses in transportation for the last mile. So in a short term perspective, there is an opportunity for an options trade. Let’s check this out, folks.

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Education

Buying options – how to increase the probability of success

In the most cases, options are bought by professional traders for hedging purposes. If you want to make money with options, you should rather sell them than buying them. The reason for this is, that option sellers have statistically a better chance to make money than option buyers. But how does it come? Well, first of all, professional traders usually don’t want to make money buying options. For them, buying options is just a hedging process and they know that they would usually lose money with it. But for them, losing “a bit” of money buying options but get hedged is a much better solution than a total loss. The other ones are private traders hoping to become rich over night buying options by assumption they would insanely increase in their value. But the most private traders have an absolute wrong approach, and that’s why they usually lose money buying options. In this article, I’d like to give you some general information how to increase the probability making profits by buying options. After that, you should get a better understanding whether buying options is a good idea or not. (more…)

Trade ideas

Today’s trade idea for option traders: The Interpublic Group of Companies (trade closed)

trade idea for option traders

Interpublic Group is an ad giant. The companies of the Group are specialized in all kinds of advertising, digital marketing, communications planning, media, public relations and so on. IPG’s revenue in the Q3 2020 demonstrated resilience in the face of the pandemic due to the steps taken to position the company as a strategic partner to its clients. And in the past days, the price of this stock knocked at the pre-pandemic level. Although there was a bounce, it could also be just a pullback. Therefore, this is giving an opportunity for a options trade. So let’s check it out, folks.

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Trade ideas

Today’s trade idea for option traders: Kimco Realty Corp. (trade closed)

trade idea for option traders

Yes, because of COVID-19 it was a bad year for REITs. And Kimco Realty was also suffering from a roughly 28% decline. Of course, with around 400 shopping centers getting shut down and consumers increasingly buying online, it’s would be hard to make money in this business. Nevertheless, Kimco could collect around 90% of its October rent and thus, the revenue was down “just” 8% in the third quarter of 2020. And that was maybe the reason Kimco increased its dividend in the fourth quarter, just after the dividend cut in the third quarter. Of course, Kimco is facing a long recovery process now. It’s not only because of the Corona pandemic but also because of the headwinds from the online shopping which is, of course, a strong competitor of retail REITs. Therefore, long term-investors should be cautious with Kimco, too. But for all option traders who are usually short term oriented, there is an opportunity to sell options and collect a premium. So let’s check it out, folks.

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Snoopy Alien