Blog Posts

The covered call – sometimes called a “buy-write” – is a common trading strategy used among all types of market participants, from day traders to institutions that often hold securities for years. A trader executes a covered call by taking a long position in a security and short-selling a call option on the underlying security […]

Traditionally, toward the end of bull markets, assets of the worst quality tend to take off. We’re also seeing this type of froth in certain pockets of the market. For example, Tesla, despite its poor balance sheet, difficulty in selling cars profitably, and its status as a car company (a capital-intensive, thin margin industry) has […]

People flock to the financial markets with the intention of making money and securing themselves financially. This article provides an illustrative example of how to make $100,000 per year from the markets. For most, this amount is enough to support a quality lifestyle. At the least, it’s a nice side income stream that alone would […]

Inter-commodity spreads (commonly known as ICS), represent the spreads between different futures contracts. Certain brokerages (e.g., Interactive Brokers) and futures exchanges (e.g., CME Group) allow you to trade them directly. The purpose of inter-commodity spreads (ICS) Many traders employ spread, or relative value, strategies. Broadly speaking, this means selling an expensive asset and buying an […]

This article was published on December 31, 2019 The IIF recently published that the global debt stock has reached $255.3 trillion at the end of 2019. This also doesn’t take into account non-debt liabilities like pensions and healthcare (which, when capitalized, are many times larger), and are debt-like in nature because they represent future IOUs. […]

Traders watch the Federal Reserve because it’s the entity that controls all money and credit created in the economy. It does this directly by creating money, and indirectly by changing how borrowers and lenders are likely to act with each other (by changing interest rates and through macroprudential policies it can execute through its regulatory […]

Commodities are typically traded as futures. Commodity carry is a strategy involving profiting off the shape of the forward curve in addition to the additional component of the risk-free rate. Defining carry Carry can be broadly defined as the yield that can be expected on a trade over the next 12 months assuming no change […]

Day trading encompasses trading short time horizons in liquid asset classes. But it’s also important to have flexibility. There is a time for day trading, swing trading, position trading (i.e., buy and hold), and also investments into less liquid asset classes, like real estate, venture capital, private equity, and even timber and teak wood investing […]

This article was published on December 7, 2019 The biggest problem for investors is the reality that asset returns will be very low going forward. There will be lower-than-normal returns with greater-than-normal risks relative to the placid environment traders have recently experienced. This is a problem given what the returns on assets will need to […]

Regardless of one’s thoughts on politics, the outcome of the November 2020 US election – particularly that of the presidency – will have a material impact on asset prices. When we talked about the big three market equilibriums that economies and assets are always continually battling for – (1) economic capacity utilization being neither too […]