Yearly Archives: 2013
Bond Risk
Richard Croft
We are witnessing a major shift in risk allocation across asset classes. As the bond market prices in tapering, medium and longer term rates are rising. With short term rates at or near zero, and likely to remain there for some time, the yield curve is steepening. As these price adjustments work their way through the system, we...
Canadian Banks Topping Today’s Most Active
Jason Ayres
After demonstrating how to take a confident stance on Toronto Dominion Bank using a protective put in last weeks blog titled Repositioning Using Puts , we see that a number of Canadian banks are starting the week off strong, occupying 6 of the 10 spots on today’s Most Active Options list: If an investor had a specific...
Could the Economy be Better than Expected?
Richard Croft
Let’s assume for a moment that the North American economies are performing better than expected. Not a real leap considering that most analysts think the broader North American economy is walking on air, with looming US debt ceiling and sequestration debates and their fast approaching January 15th deadlines notwithstanding....
Repositioning Using Puts
Jason Ayres
One of the challenges with the current market is that stocks have been extending gains on a month over month basis with very few pull backs. This is great if you had the foresight to position yourself early. However, the probability of a correction increases everyday that the market pushes higher, diminishing the near-term...
Investment Advisors using Options
Patrick Ceresna
Over the years, no topic has been more controversial then the use of options by investment advisors for unsophisticated clients. This has now reached levels where a number of Canadian wealth management firms have placed compliance restrictions on advisors, limiting them to using only the simplest strategies for their clients....
Understanding Synthetics
Jason Ayres
Despite sounding somewhat complex, a synthetic option strategy simply refers to combining an option contract with the underlying security to arrive at the same risk/reward profile of a specific options only position. It is not always the intention of the investor to implement a synthetic position. More often then not, the...
Covered Calls on Gold Stocks?
Richard Croft
It’s been some time since I talked about gold. Not surprising since I am anything but a gold bug. But when you look at where some of the premier Canadian gold stocks are trading, even the most avid non-believer has to take a second look. Not that I recommend buying the miners in search of a turnaround, but as covered call...
Selling Puts as a Strategy
Patrick Ceresna
I wanted to use this article to review and discuss the end result of the blog I wrote last month on Talisman Energy (TSX:TLM). While there was substantial options activity last month on the stock, our focus was on one particularly large trade which consisted of the selling of 10,000 put contracts of the November $12.50 strike....
TransAlta Signals a Technical Buy
Jason Ayres
This week I’m looking at TransAlta (TSE:TA) as a buying opportunity. Not only did TransAlta options make the most active list last week, an analysis of the price chart reveals a number of technical attributes supporting a continuation to the upside for the stock. TransAlta is a non-regulated electricity generation and...
Tim Hortons Earnings Follow Up
Jason Ayres
Back on October 15th, I wrote about some unusual activity on Tim Hortons options that caught my eye earlier in the week. At the time, I hypothesized that a trader may have created a position to take advantage of the earnings report scheduled to be released on November 7th. While I will provide a brief review of the strategy...
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