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News Letter Reviews The Motley Fool's Guide to Options Reviews 
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By Dr. Russell McDougal The Fed sycophants are salivating all over themselves with recent interest rate cuts. It’s never enough, though, and one cut begs another. Let the good times roll. Maybe, on the other hand, it would be better to query exactly why interest rates are being lowered. |
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| The Motley Fool's Guide to Options Reviews |
| Sunday, 20 July 2008 | |||||||||||
Continued From Motley Fool Options Strategy #1....Instead of laying out this big chunk of change, you could control these same 100 shares of Google for only $5,540 by using a long-term call option. And as the shares of stock go up over the next 7 months, your option goes up in value too.In fact, because your position is leveraged, you make more money on the call option than you would owning the shares outright -- because as the stock goes up, your call options rise faster, on a percentage basis. Of course, leverage is a double-edged sword. If Google doesn't fulfill its destiny of increasing in value in the coming months or years and if it goes down, you can lose your options premium. There are ways to protect yourself against this happening too. It's all inside "The Motley Fool's Guide to Options." Along with many examples of how you can use options safely -- without committing a lot of money. This highly profitable options strategy is a little more complicated and represents just a small sample of what awaits you in our full report. It's called a "long straddle" and involves buying both a call and a put option on the same stock. It's a strategy for making money in volatile markets when you don't know which direction a stock will move, but you expect a big move one way or another. Here's how it works: Let's say shares of DuPont are going for $40 today. To enter the long straddle around that price point you would buy an AUG 40 put contract for $200 and an AUG 40 call for $200. That's a total of $400 for your long straddle and the maximum amount of money you are risking. A month later, in August, DuPont is trading at $50. This means that your put option is worth $0 because the stock went up, not down. But since the stock gained $10 per share, your call option contract has a value of $1,000. After everything is settled, you take home a profit of $600. And this is just one piece of a larger options strategy that's designed to boost your portfolio's returns when you need it the most.
CAUTION: Before you attempt using any of these 3 options strategies, click here to download "The Motley Fool's Guide to Options" right now. Inside, you'll find a comprehensive game plan for utilizing these options strategies -- including all of their associated risks. When you download this exclusive report today, you'll also get everything you need to get started with options right now. From low-risk ways to boost your returns or hedge against downturns to high-risk, high-reward options strategies that could pay for your next vacation to Aspen or your kid's tuition to Oxford. There's an options strategy for every type of investor To find out which one is right for you, click here to instantly download your copy of this highly anticipated report prepared by the Motley Fool's top analysts. When you act now, you'll have instant access to "The Motley Fool's Guide to Options" without risk. If you aren't completely satisfied you may return it for a complete refund, no questions asked. So get your hands on these valuable options strategies and start doing more with your hard-earned money. Click Here for Instant Access to this Report Best wishes, Kate Ward Executive Publisher, The Motley Fool's Guide to Options
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