In the last article, I described what momentum investing is, and how it can be broadly applied to a personal investment portfolio. By acting as an indicator of when to buy into an opportunity that has already been established as having a strong value proposition, a momentum indicator … [Read more...]
Bad Guru Strategies to Make you Millions
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As of recent, I’ve been reading up pretty heavily on options strategies. That being said, I think I should take a minute to clarify what I mean by that. I’m not going out to options-trading-mastery.info (not a real site), trying to learn some sort of hidden-guru-secret that will make … [Read more...]
The Complexity and Risks of Covered Cap Funds
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In the final portion of this week’s marathon discussion of the use of options in a personal portfolio, I’m going to describe the risks associated with using covered cap funds in your portfolio to generate yield. Specific to a Covered Cap ETF is the risk of unexpected appreciation. … [Read more...]
How a Gold Exit Might Impact Your Currencies Portfolio
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One of the most wildly successful asset-based investments for the last few years has been gold. While it’s hard to describe what it is that actually creates value for gold investors, the returns speak for themselves. Investors speak with their dollars, and the price gold has shot … [Read more...]
Earning an Income in Selling off a Position
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In the last post I described how you can earn an income by using cash covered puts to gently introduce yourself to an equity position. While it works as a fantastic strategy to graduate a security into your portfolio, and thus reduce the psychological gravity associated with suddenly … [Read more...]
How a Gold Exit Might Impact Your Commodities Portfolio
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My favourite story from economics class is the Wizard of Oz. Believe it or not, this book was actually a story about the great depression. Go ahead, Google it and come back here when you’re done. Rather than bore you with the details, I’d like to quickly draw your attention to the … [Read more...]
Averaging Down Without the Risk
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Volatility went through the roof again this week, and to be honest, I can’t even keep track of it any more. Between the political deck-shuffling in Italy and Greece delaying any semblance of sanity in the debt markets, and a sudden re-emergence of conflict in the middle-east stirring … [Read more...]
Being Paid to Receive a Dividend, Covered Call
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This post is going to describe for you one of my favourite equity positions, the covered call. A well executed covered call position can be a cash-flow generating machine that increases the yield of a position by a complete handful of percentage points. Here’s how it works. When an … [Read more...]
An Alternative to Options Strangles
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In the last post I outlined all the theoretical benefits of a position known as an ‘Options Strangle’. Don’t get me wrong, this is an excellent position to enter, but only under very specific circumstances. From the perspective of costs and rewards, it’s extremely effective in the way … [Read more...]
Averaging Down for Cash Flow Reasons
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In my last post about averaging down without risk, I showed you a basic method of using derivatives to average down an adjusted cost base during a short-term price drop in a stock that is already in your portfolio. However, this strategy required that you put some cash on the line for … [Read more...]
Big Yields from Covered Cap ETFs
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Throughout the week, we’ve discussed the value of using options to hedge returns and increase yields. Having gone through the absolute basics of these strategies, it’s no wonder that their profitability has begun to emerge in the mutual funds industry. Specifically, “Covered Cap” ETFs … [Read more...]
Understanding Stock Market Momentum Investing
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Momentum investing is a strategy that revolves around buying high, and selling even higher. While not necessarily as mathematically grounded a strategy as others, it has demonstrated itself time and again as being an extremely effective method of money management. Specifically, … [Read more...]
Accessing Safer Foreign Bond Yields
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In the age of modern volatility, you need yield. Be it dividends, coupon payments, or GIC returns, it is extremely difficult for a small-time investor to build a personal portfolio centering on capital gains. However, unless you’ve stocked up on a year’s worth of anti-acids and nausea … [Read more...]
Maintaining Market Exposure through Traditionally Ultra Safe Asset Classes
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I find I can’t bring myself to watch the business news anymore in the mornings. Everywhere I look, panelists and pundits alike seem to be lamenting over the increasing complexity required to maintain a portfolio in the modern market. Whereas statistical and technical alchemy used … [Read more...]
The Basics of Dynamic Hedging
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Over the course of the week I’ve been describing all the nuance of a specific options strategy known as a strangle position. While the position is extremely cash intensive, it does provide an interesting thought experiment that might provide some additional insights into how it is we … [Read more...]
32 Holdings Equals a Diversified Investment Portfolio
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Diversification is a confusing topic for some investors. More often than not, it simply acts as a media buzz word to sell investors more securities into their portfolio than they need. However, there can be no argument against the effectiveness of diversification as a means of … [Read more...]
How DRIP Dilution Can Hurt Your Investment Portfolio
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Dividend Re-Investment Plans are an excellent program for an investor to build up a nominal position in a company over time. They allow an investor to opt out of cash dividends in favour of distributions that are composed of more stock. If the stock is expected to rise more over the … [Read more...]
Switching Equity Yields for Corporate Bond Yields
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In the last post, I showed you how a simple bank transaction (a currency swap) can unlock some extremely attractive foreign bond yields, while maintaining a risk level that is remarkably similar to their domestic equivalents. Today, I’m going to take the same train of thought one … [Read more...]
Earning Income Through Purchase Transactions
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One of the most difficult parts of investing is making the decision to buy or sell a position. It’s not so much even a question of whether or not we have the technical/fundamental understanding required to make such a decision, as much as it is an issue of emotion. Have you ever been … [Read more...]
How To Avoid DRIP Dilution
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In the last article, I discussed how it is that a DRIP program can create a capital flight scenario that can be extremely destructive to your overall position. Through exposure to dilution and unrealistic growth expectations, DRIP programs can sometimes be hard to justify, even with … [Read more...]
