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  • Index Put Options | Online Stockmarket Trading Update
    As can be seen from the payoff diagram above should the market retreat the value of the put options rises offsetting the losses taken by the portfolio In cases where the investor is wrong about the direction of the market their holding will continue to appreciate along with the market s rise However there is a downside in that if the market stays flat then there will be a loss equal to the premium paid for the put insurance the index put option Note The example above example assumes full correlation with beta of 1 0 between the portfolio and the index and transaction costs are not included in the calculations If the index pulled back 5 by index options expiry The index would be trading at around 4425 and the 4450 DEC13 index put option would be worth 2 25 while the portfolio would be devalued to 450 000 1 0 05 427 500 so the total position would be at breakeven i e 2 25 1000 10 427 500 450 000 of course you have initially paid the 6 000 for the insurance using the index put options Conclusion You can use index put options as insurance protection in order to protect your portfolio However you need to be consistently correct in your view about the market direction as it would be detrimental to your portfolio performance if you outlaid 1 3 of your portfolio every two months and the market either trades sideways or rose modestly You do have the opportunity to close the option position at any time before expiry if your view of the market changes and there are a number of strategies that you can use to reduce the cost of the insurance Utilising the Index Collar Strategy reduces the cost of protection and allows the investor to finance the purchase of the index put options by simultaneously selling index call options This strategy is also known as the Index Collar and will be discussed in later articles Alternatively you can use a Put Spread strategy to reduce costs If you want to take advantage of portfolio insurance then the index put options are an excellent strategy that can be used to protect your investment portfolio Contact us at D2MX Advisory on 1300 610 024 and we can help you trade using this strategy For more trade ideas and recommendations sign up for a free trial of the D2MX Daily Trading Report which provides a daily serving of insightful market analysis from the D2MX Advisory team including Trade ideas and strategies Dividend enhancement strategies Market scans to watch International market analysis and Highlights from the S P ASX 200 To request an obligation free trial call 1300 610 024 or email advisory d2mx com au Also in this series Part 1 Simple Trend Finder Scanning Method Part 2 Going For Gold Part 3 The Gap Trading Method Part 4 The Power of Compounding Part 5 Measuring Your Trading Performance Michael Hevern Investment Adviser D2MX

    Original URL path: http://blog.traderdealer.com.au/tag/index-put-options/ (2013-02-02)
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  • Investment Portfolio | Online Stockmarket Trading Update
    As can be seen from the payoff diagram above should the market retreat the value of the put options rises offsetting the losses taken by the portfolio In cases where the investor is wrong about the direction of the market their holding will continue to appreciate along with the market s rise However there is a downside in that if the market stays flat then there will be a loss equal to the premium paid for the put insurance the index put option Note The example above example assumes full correlation with beta of 1 0 between the portfolio and the index and transaction costs are not included in the calculations If the index pulled back 5 by index options expiry The index would be trading at around 4425 and the 4450 DEC13 index put option would be worth 2 25 while the portfolio would be devalued to 450 000 1 0 05 427 500 so the total position would be at breakeven i e 2 25 1000 10 427 500 450 000 of course you have initially paid the 6 000 for the insurance using the index put options Conclusion You can use index put options as insurance protection in order to protect your portfolio However you need to be consistently correct in your view about the market direction as it would be detrimental to your portfolio performance if you outlaid 1 3 of your portfolio every two months and the market either trades sideways or rose modestly You do have the opportunity to close the option position at any time before expiry if your view of the market changes and there are a number of strategies that you can use to reduce the cost of the insurance Utilising the Index Collar Strategy reduces the cost of protection and allows the investor to finance the purchase of the index put options by simultaneously selling index call options This strategy is also known as the Index Collar and will be discussed in later articles Alternatively you can use a Put Spread strategy to reduce costs If you want to take advantage of portfolio insurance then the index put options are an excellent strategy that can be used to protect your investment portfolio Contact us at D2MX Advisory on 1300 610 024 and we can help you trade using this strategy For more trade ideas and recommendations sign up for a free trial of the D2MX Daily Trading Report which provides a daily serving of insightful market analysis from the D2MX Advisory team including Trade ideas and strategies Dividend enhancement strategies Market scans to watch International market analysis and Highlights from the S P ASX 200 To request an obligation free trial call 1300 610 024 or email advisory d2mx com au Also in this series Part 1 Simple Trend Finder Scanning Method Part 2 Going For Gold Part 3 The Gap Trading Method Part 4 The Power of Compounding Part 5 Measuring Your Trading Performance Michael Hevern Investment Adviser D2MX

    Original URL path: http://blog.traderdealer.com.au/tag/investment-portfolio/ (2013-02-02)
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  • Covered Call | Online Stockmarket Trading Update
    of Market Environments Part 1 The Protective Put Options Trading for All Types of Market Environments Part 2 The Covered Call Options Trading for All Types of Market Environments Part 3 The Covered Call Collar Options Trading for All Types of Market Environments Part 4 Stock Repair For Buy and Sell recommendations on ASX listed companies register for a free trial of MDS Financial Research MDS Financial Advisory Services offers general advice on trading options to generate consistent steady income on your investment portfolio Call 1300 610 024 for further information Tags covered call Dividends Ex Dividend options trading Telstra trading for dividends Trading Strategy Posted in Trading Strategies No Comments The Covered Call Collar Part 3 of Options Trading for All Types of Market Environments Friday August 12th 2011 Part 3 The Covered Call Collar The Covered Call Collar is an options trading strategy that traders can use to protect an existing position that has recently surged into a key resistance level Rather than simply taking profits on the share position and potentially missing out on future upside the trader enters into a Covered Call Collar This options trading strategy seeks to protect your existing share position while still participating in some of the upside for a minimal or no outlay The Covered Call Collar allows you to participate in some of the future gains up to the sold strike price while being protected by the put position Covered Call Collar ideal for participating in future gains while being protected on the downside If you are of the opinion that the stock is likely to sell off with little chance of breaking the key resistance level but you still want to hold on to it you could use a Covered Call Collar options strategy The Covered Call Collar strategy is similar to the protective put options strategy in that you also buy put options as protection The difference is that you will now finance the purchase of those put options with the proceeds from writing an equal number of out of the money call options The position will still protect you from losses below the strike price of the put options at minimal to no cost to yourself but it will also stop the position from profiting beyond the strike price of the short call options should the stock stage a rally That is you would miss out on a strong rally in exchange for putting on the protection of the put options for next to no cost apart from commissions of course Use a Covered Call Collar when you expect the share price to move modestly higher or pull back significantly from current levels Recent Trade Newcrest Mining NCM A recent trade which is yet to pay off was Newcrest Mining We initially entered the share position when the stock price broke above its 50 and 200 day moving averages around 38 50 It shot up soon after we entered the trade and has now been trading sideways for the past few weeks We considered a covered collar was appropriate for this position Based on technical analysis you can see from the chart that the 42 50 resistance level has held for over a year So we bought protection at 39 00 by buying 3900 SEP11 Put for 0 645 and then wrote the 42 50 SEP11 Calls for 0 775 We received a credit for this trade and the position remains open We are protected until September expiry down to 39 00 and profits will be capped at 42 50 Chart 1 Newcrest Mining Covered Call Collar Trade You can plan and analyse your trade as shown above using the Derivative Profiler option in the Market Analyser software MarketAnalyser also provides a payoff diagram for further trade analysis as follows Chart 2 The payoff diagram for the Newcrest Covered Call Collar trade Trade Note Newcrest NCM is still trading between the 39 00 and 42 50 option strike levels and only time will tell whether the share price will end up at expiry but we are protected until September expiry down to 39 00 and profits will be capped at 42 50 The Trade Options can be used in order to reduce your risk while still participating in potential profits from a modest move in the underlying stock Here we ve explained the Covered Call Collar strategy which allows you to participate in some of the future gains up to the sold strike price while being protected by the put position In future articles we will talk about the High Yield Covered Call strategy and the Stock Repair strategy which is particularly relevant to this market Utilise the features in the Market Analyser software to plan your trades for the particular options strategy using your specific trade selection criteria You will save time and potentially reduce your trading risk Sign up for a free 14 day software trial here By Michael Hevern Head of Research See Also Options Trading for All Types of Market Environments Part 1 The Protective Put Options Trading for All Types of Market Environments Part 2 The Covered Call For buy and sell recommendations on ASX listed companies register for a free trial of MDS Financial Research MDS Financial Advisory Services offers general advice on trading options to generate consistent steady income on your investment portfolio Call 1300 610 024 for further information Tags covered call Financial Advisory Market Analyser Newcrest Mining options options trading Trading Strategies Posted in ASX Trading News Trading Strategies 1 Comment The Covered Call Part 2 of Options Trading for All Types of Market Environments Friday July 22nd 2011 Part 2 The Covered Call The Covered Call also known as a Covered Buy Write or Covered Call Write is the options trading strategy that most beginners learn about It is a strategy which seeks to make a monthly income by selling call options against existing stock holdings The Covered Call allows you to generate a regular monthly rental

    Original URL path: http://blog.traderdealer.com.au/tag/covered-call/ (2013-02-02)
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  • Telstra | Online Stockmarket Trading Update
    the investor s own risk profile Consistent Steady Income Strategy The Metrics I ve done some sample calculations to give you an idea of the metrics of the trade refer to the table at the end of this article The calculations show the returns if the Telstra share price either falls to 3 00 stays flat at 3 25 or rises to 3 75 at the end of the 12 month period This chart shows the returns based on a number of different final trading prices for Telstra ranging from 3 00 to 4 00 Note a number of brokerage houses have a 12 month target of around 4 25 for Telstra Chart 1 Performance of the Investment with Telstra ending at various levels 3 00 3 25 3 50 or 3 75 at the end of the 12 month period Cost Price 3 25 Investment Highlights The performance chart confirms that the strategy would Generate a loss if the stock closed at 3 00 a 7 7 fall in the stock price Even including the grossed up dividends it would lose 4 9 on the total investment and if the portfolio was leveraged at 50 then the investment would lose close to 10 for the year Be profitable even if the share price stayed flat at 3 25 The grossed up yield would be 2 8 on the total investment i e including the dividends and franking credits and if the portfolio was leveraged at 50 then the investment would generate close to 6 for the year Significantly outperform the returns on a similar investment in property or fixed interest if the stock price rises to 3 50 or is up just 7 7 the grossed up yield would be 10 5 on the total investment i e including the dividends and franking credits and if the portfolio was leveraged at 50 then the investment would generate close to 21 for the year Note that transaction costs have not been included in the calculations and that there would be additional tax benefits from claiming on the interest paid on the loan Margin Loan Risks Before proceeding it is worth considering some of the risks of this strategy Borrowing to acquire an investment that falls in value or does not earn a net return greater than your borrowing costs will result in a larger loss or lower after tax return than if you had not borrowed to invest or not invested at all But it can also leverage returns The value of your investments can change in unexpected ways and may not earn the net return you expect and you may be subject to a margin call to top up the loan to value ratio LVR Changes in the price of an investment are usually a key determinant of the return you earn or loss you incur on an investment Using a 50 LVR considerably reduces the chances of a margin call You are responsible for your investment choices and consequently whether any net return is sufficient to cover the cost of borrowing and other costs and the investment s suitability to your circumstances and financial objectives Unless you apply for a Fixed Rate Loan the Lender may vary the Variable Rate applicable to your Margin Loan Facility at any time Consistent Steady Income Strategy The Trade How can you make money in such a strategy Let s evaluate the benefits of this trading strategy This is a way that you can leverage your way into an equity portfolio in order to build wealth Note that the dividend yield on Telstra was particularly high over 9 at the time the investment was initiated With the current market pullback we will get another opportunity for this type of investment The chart below uses a purchase price of 3 50 The returns still have the potential to outperform property and fixed interest investments but of course there would be more chance that the share price may finish below the original purchase price This strategy cannot be used within a Self Managed Super Fund SMSF however we can offer alternatives using installment warrants strategies We can also offer option strategies that can further reduce the market risk on the trade Chart 2 Performance of the Investment with Telstra ending at various levels 3 25 3 50 3 75 or 4 00 at the end of the 12 month period Cost Price 3 50 Disadvantages The stock price might fall over the twelve month investment timeframe Leverage is a two edged sword and we have shown that the investment would start to lose if the stock price falls too far However there are option strategies that we can implement to mitigate this risk Conclusion This strategy is paying off handsomely in the current market environment and may well explain why Telstra shares have shot up so much in the first part of this year The strategy does offer the investor a viable investment alternative to either property or fixed interest investments and can be incorporated in SMSFs through the use of installment warrants which I have touched on in discussions in a previous article about Boosting Your Investment Returns We may well get another opportunity to implement this strategy in the near term using Telstra or some other consistently high dividend paying stock given the aggressive market pullback we are currently experiencing Contact me at D2MX Trading on 1300 610 024 and I can help you trade using this or a number of other strategies that can help boost your return on investment Michael Hevern Investment Adviser D2MX Trading This report was prepared by Michael Hevern It represents the views and opinions of the author It is not intended for use by any third party without the approval of Michael Hevern While this report is based on information from sources which are considered reliable its accuracy and completeness cannot be guaranteed Any opinions expressed reflect my judgment at this date and are subject to change Contracting Hevern Pty Ltd is a Corporate Authorised Representative No 408868 of D2MX Pty Limited ABN 98 113 959 596 AFSL No 297950 D2MX and Michael Hevern has been appointed as an Authorised Representative of Contracting Hevern Pty Ltd Opinions conclusions and other information expressed in this report are not given or endorsed by D2MX unless otherwise indicated The information contained in this Report is General Advice only as the information or advice given does not take into account your particular objectives financial situation or needs Disclaimer Using leverage to invest can be a two edged sword as it can magnify your returns when the stock price rises but will in turn magnify the losses if the trade does not perform as expected TABLE 1 Returns for Telstra ending at various levels 3 00 3 25 or 3 75 at the end of the 12 month period Cost Price 3 25 Contact me at D2MX Trading on 1300 610 024 Tags d2mx Dividends high yield Investment leverage margin loan Telstra trading shares Trading Strategy Posted in Stock Market Analysis Trading Strategies No Comments Dividends Telstra Ex Dividend On 22 8 2011 Wednesday August 17th 2011 Telstra Corporation TLS will go ex dividend on 22 8 2011 The current dividend payment is 14 cents and it is 100 franked The record date is 26 8 2011 and the dividend will be paid on 23 9 2011 Based on the full year payment the dividend yield is 9 2 Current Yield 4 6 Franking 100 DRP Discount Not Available Telstra Corporation Yield has been calculated on the closing price on the 15 8 2011 Current yield is based on the current dividend payment only Tags Dividend Ex Dividend Telstra TLS Posted in Upcoming Dividends No Comments ASX Company News Leighton Awarded 350 million Telstra Contract Friday February 11th 2011 Thiess Services a wholly owned subsidiary of Leighton Holdings LEI will benefit from a major five year Telstra contract awarded to Silcar a joint venture company between Thiess Services and Siemens Ltd Under the new contract Silcar will provide Network Integrity and Facilities Management services for Telstra s exchanges and assets nationwide under a five year agreement estimated at 350m Silcar will undertake asset management and maintenance on Telstra s network facilities that support its telecommunications network including critical infrastructure such as standby power energy and cooling systems Thiess Managing Director David Saxelby said the contract reaffirmed the working relationship between the two organisations was built on proven performance Silcar s strong relationship with Telstra has grown over more than 10 years and this contract recognises Silcar s advanced and reliable capabilities Mr Saxelby said Thiess Services Executive General Manager and Silcar Chairman Michael Wright said the contract would provide Silcar with renewed opportunities to support Telstra in improving the value and sustainability of its network facilities Silcar will to continue to work safely and maintain the superior level of service Telstra has come to expect in the delivery of network integrity and facility management services Mr Wright said Thiess Services is a wholly owned subsidiary of Thiess Pty Ltd and has an annual turnover of approximately 1 billion The company provides integrated environmentally responsible services to a range of business sectors including water energy contaminated site remediation waste management telecommunications infrastructure operations and maintenance and facilities management Thiess has an annual turnover of 7 billion and 16 billion work in hand With over 17 000 employees it has become one of Australia s leading and most trusted construction mining and services companies www thiess services com au www leighton com au http www traderdealer com au Fundamentals lei Tags LEI Leighton Maintenance services New contract Siemens Telecommunications Telstra Thiess TLS Posted in ASX Company News No Comments ASX Company News World Reach Receives 2 million Telstra Order Saturday September 18th 2010 World Reach Limited WRR is pleased to announce that it s wholly owned subsidiary Beam Communications Pty Ltd has received a significant order from Telstra Corporation with a value of 2M This order for Beam s SatDOCK In vehicle Hands free Docking Station and an Iridium Satellite Telephone follows the initial order in December 2009 and will also include the latest Beam IntelliDOCK and Beam RapidSAT solutions These units will be distributed through Telstra s extensive Australia wide sales channels Beam has experienced strong acceptance in the market for its Iridium based docking solutions and this additional major order from Telstra further demonstrates the demand for these bundled solutions for the Australian market place Deliveries will commence in September and will be completed by February 2011 Beam Communications Pty Ltd is a wholly owned subsidiary of World Reach Limited WRR Beam Communications designs manufactures and distributes a wide range of Satellite and GSM voice data tracking terminals and accessories for the global telecommunications market Through a global network of Resellers Beam solutions are deployed into a wide range of vertical markets including Maritime Transport Government Defence Mining Construction Forestry Emergency Services Relief Aid Telemetry and Rural Telephony World Reach Limited is an Australian publicly listed company with strategic ownership of companies involved in the design manufacturing and distribution of equipment applications and services to the global needs of Information Communication Technology markets World Reach Limited is an Australian publicly listed company owning 100 of Beam Communications Pty Ltd www worldreach com au www beamcommunications com http www traderdealer com au Fundamentals wrr Tags Beam Communications New contract Satellite phones Telstra TLS World Reach WRR Posted in ASX Company News No Comments A Labor Minority Government Investment Impacts Tuesday September 7th 2010 The federal election result is finally resolved after two and a half weeks of negotiations The Labor party will form a minority government alongside Greens MP Adam Bandt and independents Andrew Wilkie Tony Windsor and Rob Oakeshott for a 76 Labor to 74 Coalition decision Ms Gillard is now the first elected female prime minister of Australia This means that investors now have clarification on National Broadband Network NBN This was a key differentiator in the final decisions of the independents Telstra stands to receive 11 billion from the Labor government as the NBN goes ahead Super Levy Labor will implement a 12 compulsory level which will favourably impact banks and investment funding pools Minerals Resource Rent Tax MRRT The mining tax will get the go ahead and our miners will be directly impacted by this Indirectly the MRRT will impact superannuation investment returns Banks Will benefit from the 12 super levy With the return of the Labor Government banks should avoid being in the government spotlight with regard to the imposing of taxes on their super profits tax which would have negatively impacted their bottom line Infrastructure There will be some additional spending or promises brought forward for infrastructure spend particularly in regional electorates This will positively impact our construction sector Gambling Anti pokie supporters may get a bigger say This would negatively impact stocks like Crown TabCorp and Tattersalls The Trade The 17 day process for reaching the final resolution of the election has meant that investors have been hesitant to commit to the market as reflected in the low trading volumes of late The decision for a minority Labor government has given some clarity going forward We have highlighted above some of the specific stocks that will be impacted with the new government policies The key issues that swayed the decisions of the independents included Stability of any new government National broadband network Climate change Regional package Education and a tax summit The independents have guaranteed the passage of bills that are essential to keep the government functioning such as supply However they will not necessarily vote with Labor in all matters so time will tell how workable the new minority Labor government will be In the words of MP Rob Oakeshott we are in for a WOW of a time By Michael Hevern Head of Research Tags elections and the market gillard Labor minority government National Broadband Network NBN Telstra Posted in Stock Market Analysis No Comments Stock Market Analysis Investors Hang on for Election Decision Wednesday August 25th 2010 Investors Hang on for Election Decision The unresolved Federal Election on the weekend has left the country with a hung parliament for the first time since the 1940 s and raises a number of issues for investors which include Super Levy Labor is pushing for a 12 compulsory level which will favorably impact banks and investment funding pools Minerals Resource Rent Tax MRRT The mining tax hangs in the balance with the Liberals promising to abolish the tax Our miners will be directly impacted by this Indirectly the resolution of the MRRT will impact superannuation investment returns National Broadband Network NBN Telstra stands to receive 11 billion from the Labor government if the NBN goes ahead but the Liberals are promising to abandon this thus hurting Telstra s bottom line Banks Are set to benefit from the 12 super levy However there may be concerns that a new government will turn their attention to imposing taxes on their super profits tax which will negatively impact their bottom line Infrastructure There may be some additional spending or promises brought forward for infrastructure spend to get either party across the line particularly in regional electorates This would positively impact our construction sector Gambling Anti pokie supporters may get a bigger say This could negatively impact stocks like Crown TabCorp and Tattersalls The Trade The final resolution of the elections is likely to take at least another week and this will impact the Australian market as a whole as investors do not like uncertainty Obviously the ultimate outcome of the elections will have impacts on specific stocks However at this stage experts cannot agree on who will emerge triumphant so it is difficult to position your portfolio accordingly By Michael Hevern Head of Research Tags Federal election hung parliament Minerals Resource Rent Tax MRRT NBN Stock Market Analysis Telstra Posted in Stock Market Analysis No Comments Dividends Telstra Corporation Ex Dividend On 23 8 2010 Monday August 16th 2010 Telstra Corporation TLS will go ex dividend on 23 8 2010 The current dividend payment is 14 cents and it is 100 franked The record date is 27 8 2010 and the dividend will be paid on 24 9 2010 Based on the full year payment the dividend yield is 9 6 Current Yield Franking 100 DRP Discount Not Available www telstra com au Yield has been calculated on the closing price on the 13 8 2010 Current yield is based on the current dividend payment only Tags Dividends Ex Dividend Telstra TLS Posted in Upcoming Dividends No Comments Stock Market Analysis Gold at Record Again U S Markets up for the second week Monday June 21st 2010 Stock Market Analysis Gold Record Again U S Markets up for the second week U S stocks ended the day flat but are up for a second week Across in Europe Spain successfully auctioned off it s debt to refresh it s funds and plans to publish banks stress test results in the next few weeks this lead to improved investor confidence Our market is likely to open flat with Telstra and Gold stocks to provide support The SPI Futures is above the key level of 4500 the ASX is set to open flat as the SPI closed up 6 points or 0 1 at 4 566 Key levels this week are 4450 and 4650 Expect our market to trade flat today with gold stocks again in focus as the precious metals reaches record highs also expect to see some action in Telstra after progress on the 11 billion NBN deal U S Markets Miners and in particular gold miners lead again the U S as the precious metal again closed at new highs Friday in the U S also saw the options and futures contract expire which bought about an increase in trading volumes but market volatility overall decreased In

    Original URL path: http://blog.traderdealer.com.au/tag/telstra/ (2013-02-02)
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  • Trading For Dividends | Online Stockmarket Trading Update
    for this position Based on technical analysis you can see from the chart below that the 3 80 resistance level has held for over three years So when Telstra was trading around 3 66 we bought protection at 3 60 by buying 360 JUL12 Put for 0 05 and then sold the 380 JUL12 Calls for 0 03 This trade cost 2 cents but we are protected until the end of July expiry down to 3 65 and profits will be capped at 3 80 Chart 1 Telstra Dividend Capture Covered Call Collar Trade You can plan and analyse your trade as shown above using the Derivatives functionality in the Market Analyser 7 software refer to the Market Analyser 7 Derivatives Video Tutorial for a demonstration Trade Note Telstra TLS is still trading between the 3 60 and 3 80 option strike levels and only time will tell where the share price will end up at expiry However we are protected until July expiry down to 3 55 but profits will be capped at 3 80 The Trade Options can be used to reduce your risk while still participating in potential profits from a significant move by the underlying stock The Dividend Capture Covered Call Collar strategy allows you to participate is some of the future gains up to the sold strike price and hopefully the dividend while being protected by the put position Note due to the low volatility in the Telstra stock you could have simply just bought the puts because you are paying approximately 1 5 of the stock value to protect your position down to 3 55 until the end of July with the prospect of a 4 dividend plus franking credits due in August Utilise the features in the Market Analyser 7 software to trade plan your options trades for the particular options strategy using your specific trade selection criteria You will save time and potentially reduce your trading risk Contact me at D2MX Trading on 1300 610 024 and I can help you trade using a number of strategies that will give you the tools to navigate this market and help you boost your returns on investment Banking stocks like Commonwealth Bank are ideal for this strategy I trust that this information has been helpful Please note your may need to refer to a tax professionial regarding eligibility of franking credits Michael Hevern Investment Adviser D2MX Trading This report was prepared by Michael Hevern It represents the views and opinions of the author It is not intended for use by any third party without the approval of Michael Hevern While this report is based on information from sources which are considered reliable its accuracy and completeness cannot be guaranteed Any opinions expressed reflect my judgment at this date and are subject to change Contracting Hevern Pty Ltd is a Corporate Authorised Representative No 408868 of D2MX Pty Limited ABN 98 113 959 596 AFSL No 297950 D2MX and Michael Hevern has been appointed as

    Original URL path: http://blog.traderdealer.com.au/tag/trading-for-dividends/ (2013-02-02)
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  • Trading Strategy | Online Stockmarket Trading Update
    and other information expressed in this report are not given or endorsed by D2MX unless otherwise indicated The information contained in this Report is General Advice only as the information or advice given does not take into account your particular objectives financial situation or needs Disclaimer Using leverage to invest can be a two edged sword as it can magnify your returns when the stock price rises but will in turn magnify the losses if the trade does not perform as expected For Buy and Sell recommendations on ASX listed companies register for a free trial of MDS Financial Research The D2MX Financial Advisory Services offers general advice on trading options to generate consistent steady income on your investment portfolio Call 1300 610 024 for further information Tags company earnings day trading gap trading stock trading tips trading asx shares Trading Strategy trading system Posted in Trading Strategies No Comments Dividend Capture Covered Call Collar Part 10 of Options Trading for All Types of Market Conditions Friday June 22nd 2012 The Dividend Capture Covered Call Collar is an options trading strategy traders can use to protect an existing position that has recently surged into a key resistance level and is about to pay a dividend Rather than simply taking profits on the share position paying capital gains tax and potentially missing out on the dividend and future upside the trader enters into a Dividend Capture Covered Call Collar This strategy seeks to protect your existing share position while still participating in some of the upside including the dividend for a modest outlay The Dividend Capture Covered Call Collar allows you to participate in some of the future gains up to the sold strike price and hopefully the dividend while being protected by the put position Dividend Capture Covered Call Collar is ideal for participating in future gains and picking up the dividend while being protected on the downside If you are of the opinion that the stock market is likely to sell off and the share has little chance of breaking the key resistance level but you still want to hold on to it for the dividend you could use a Dividend Capture Covered Call Collar options strategy The Dividend Capture Covered Call Collar strategy is similar to the protective put options strategy in that you also buy put options as protection The difference is that you will now finance the purchase of those put options with the proceeds from writing an equal number of out of the money call options The position will still protect you from losses below the strike price of the put options at minimal cost to yourself but it will stop the position from profiting beyond the strike price of the short call options should the stock stage a rally and you could miss out on the dividend if this rally happens before the ex dividend date That is you would miss out on a strong rally in exchange for putting on the protection of the put options for free apart from commissions of course Use a Dividend Capture Covered Call Collar when you expect the share price to move modestly higher or pull back significantly from current levels and you want to hang on for the dividend Income Trade Telstra for Dividend Here at D2MX Advisory we recommended buying Telstra for the dividend yield in January this year when Telstra was trading at 3 30 This trade was intended to capture the dividend s but the share price has subsequently jumped to as high as 3 75 where it met resistance Recently we ve had queries from clients worried about the overall state of the markets and who want to hold on to Telstra for the next dividend while protecting themselves on the downside So this week we discuss how you can hold on to your Telstra shares for the dividend TLS goes ex div 0 14 on 22 Aug 12 by utilising the Dividend Capture Collar Strategy Given the turmoil in the eurozone which has been triggered by the worsening problems with the eurozone financial system and the debt crisis we considered a Dividend Capture Covered Collar was appropriate for this position Based on technical analysis you can see from the chart below that the 3 80 resistance level has held for over three years So when Telstra was trading around 3 66 we bought protection at 3 60 by buying 360 JUL12 Put for 0 05 and then sold the 380 JUL12 Calls for 0 03 This trade cost 2 cents but we are protected until the end of July expiry down to 3 65 and profits will be capped at 3 80 Chart 1 Telstra Dividend Capture Covered Call Collar Trade You can plan and analyse your trade as shown above using the Derivatives functionality in the Market Analyser 7 software refer to the Market Analyser 7 Derivatives Video Tutorial for a demonstration Trade Note Telstra TLS is still trading between the 3 60 and 3 80 option strike levels and only time will tell where the share price will end up at expiry However we are protected until July expiry down to 3 55 but profits will be capped at 3 80 The Trade Options can be used to reduce your risk while still participating in potential profits from a significant move by the underlying stock The Dividend Capture Covered Call Collar strategy allows you to participate is some of the future gains up to the sold strike price and hopefully the dividend while being protected by the put position Note due to the low volatility in the Telstra stock you could have simply just bought the puts because you are paying approximately 1 5 of the stock value to protect your position down to 3 55 until the end of July with the prospect of a 4 dividend plus franking credits due in August Utilise the features in the Market Analyser 7 software to trade plan your options trades for the particular options strategy using your specific trade selection criteria You will save time and potentially reduce your trading risk Contact me at D2MX Trading on 1300 610 024 and I can help you trade using a number of strategies that will give you the tools to navigate this market and help you boost your returns on investment Banking stocks like Commonwealth Bank are ideal for this strategy I trust that this information has been helpful Please note your may need to refer to a tax professionial regarding eligibility of franking credits Michael Hevern Investment Adviser D2MX Trading This report was prepared by Michael Hevern It represents the views and opinions of the author It is not intended for use by any third party without the approval of Michael Hevern While this report is based on information from sources which are considered reliable its accuracy and completeness cannot be guaranteed Any opinions expressed reflect my judgment at this date and are subject to change Contracting Hevern Pty Ltd is a Corporate Authorised Representative No 408868 of D2MX Pty Limited ABN 98 113 959 596 AFSL No 297950 D2MX and Michael Hevern has been appointed as an Authorised Representative of Contracting Hevern Pty Ltd Opinions conclusions and other information expressed in this report are not given or endorsed by D2MX unless otherwise indicated The information contained in this Report is General Advice only as the information or advice given does not take into account your particular objectives financial situation or needs Disclaimer Using leverage to invest can be a two edged sword as it can magnify your returns when the stock price rises but will in turn magnify the losses if the trade does not perform as expected See Also Options Trading for All Types of Market Environments Part 1 The Protective Put Options Trading for All Types of Market Environments Part 2 The Covered Call Options Trading for All Types of Market Environments Part 3 The Covered Call Collar Options Trading for All Types of Market Environments Part 4 Stock Repair For Buy and Sell recommendations on ASX listed companies register for a free trial of MDS Financial Research MDS Financial Advisory Services offers general advice on trading options to generate consistent steady income on your investment portfolio Call 1300 610 024 for further information Tags covered call Dividends Ex Dividend options trading Telstra trading for dividends Trading Strategy Posted in Trading Strategies No Comments Steady Returns Through High Dividend Paying Stocks Friday May 25th 2012 At the start of the year I highlighted some key investment themes for 2012 one of which would be for investors to look to companies with solid growth and consistent yields And not long before that I identified some stocks that consistently pay high dividends Given the rout we are experiencing in the global markets as the bears take control I thought might be timely to review a strategy that our D2MX clients were given at the start of the year Consistent Income Strategy The Methodology The primary goal for the investment strategy was to look for opportunities that had a high probability of producing above average returns for the next twelve to eighteen months The strategy was developed in an environment where the RBA was forecast to be reducing the cash rate down towards 3 by the end of the year and the property market was at best flat This strategy was developed as a good alternative to trying make money through investing in the property markets where rental yields are currently only 3 4 and there is little prospect of significant capital growth near term The strategy also has a high probability of offering a better return than simply leaving funds on term deposit although there is market risk involved The first step in this strategy was to identify a stock that paid consistently high dividends and was likely to hold its dividend for at least the next year Consistent Steady Income Strategy The Overview The stock we selected for this strategy was Telstra which was trading at 3 25 and was on a dividend yield of 8 6 grossed up to 12 3 Telstra was about to have the NBN deal ratified by the regulator and had a confirmed dividend of 0 28 per annum for at least the next 18 months We proposed using a margin loan of 100 000 with interest at 9 5 and with the leverage dependent on the investor s own risk profile Consistent Steady Income Strategy The Metrics I ve done some sample calculations to give you an idea of the metrics of the trade refer to the table at the end of this article The calculations show the returns if the Telstra share price either falls to 3 00 stays flat at 3 25 or rises to 3 75 at the end of the 12 month period This chart shows the returns based on a number of different final trading prices for Telstra ranging from 3 00 to 4 00 Note a number of brokerage houses have a 12 month target of around 4 25 for Telstra Chart 1 Performance of the Investment with Telstra ending at various levels 3 00 3 25 3 50 or 3 75 at the end of the 12 month period Cost Price 3 25 Investment Highlights The performance chart confirms that the strategy would Generate a loss if the stock closed at 3 00 a 7 7 fall in the stock price Even including the grossed up dividends it would lose 4 9 on the total investment and if the portfolio was leveraged at 50 then the investment would lose close to 10 for the year Be profitable even if the share price stayed flat at 3 25 The grossed up yield would be 2 8 on the total investment i e including the dividends and franking credits and if the portfolio was leveraged at 50 then the investment would generate close to 6 for the year Significantly outperform the returns on a similar investment in property or fixed interest if the stock price rises to 3 50 or is up just 7 7 the grossed up yield would be 10 5 on the total investment i e including the dividends and franking credits and if the portfolio was leveraged at 50 then the investment would generate close to 21 for the year Note that transaction costs have not been included in the calculations and that there would be additional tax benefits from claiming on the interest paid on the loan Margin Loan Risks Before proceeding it is worth considering some of the risks of this strategy Borrowing to acquire an investment that falls in value or does not earn a net return greater than your borrowing costs will result in a larger loss or lower after tax return than if you had not borrowed to invest or not invested at all But it can also leverage returns The value of your investments can change in unexpected ways and may not earn the net return you expect and you may be subject to a margin call to top up the loan to value ratio LVR Changes in the price of an investment are usually a key determinant of the return you earn or loss you incur on an investment Using a 50 LVR considerably reduces the chances of a margin call You are responsible for your investment choices and consequently whether any net return is sufficient to cover the cost of borrowing and other costs and the investment s suitability to your circumstances and financial objectives Unless you apply for a Fixed Rate Loan the Lender may vary the Variable Rate applicable to your Margin Loan Facility at any time Consistent Steady Income Strategy The Trade How can you make money in such a strategy Let s evaluate the benefits of this trading strategy This is a way that you can leverage your way into an equity portfolio in order to build wealth Note that the dividend yield on Telstra was particularly high over 9 at the time the investment was initiated With the current market pullback we will get another opportunity for this type of investment The chart below uses a purchase price of 3 50 The returns still have the potential to outperform property and fixed interest investments but of course there would be more chance that the share price may finish below the original purchase price This strategy cannot be used within a Self Managed Super Fund SMSF however we can offer alternatives using installment warrants strategies We can also offer option strategies that can further reduce the market risk on the trade Chart 2 Performance of the Investment with Telstra ending at various levels 3 25 3 50 3 75 or 4 00 at the end of the 12 month period Cost Price 3 50 Disadvantages The stock price might fall over the twelve month investment timeframe Leverage is a two edged sword and we have shown that the investment would start to lose if the stock price falls too far However there are option strategies that we can implement to mitigate this risk Conclusion This strategy is paying off handsomely in the current market environment and may well explain why Telstra shares have shot up so much in the first part of this year The strategy does offer the investor a viable investment alternative to either property or fixed interest investments and can be incorporated in SMSFs through the use of installment warrants which I have touched on in discussions in a previous article about Boosting Your Investment Returns We may well get another opportunity to implement this strategy in the near term using Telstra or some other consistently high dividend paying stock given the aggressive market pullback we are currently experiencing Contact me at D2MX Trading on 1300 610 024 and I can help you trade using this or a number of other strategies that can help boost your return on investment Michael Hevern Investment Adviser D2MX Trading This report was prepared by Michael Hevern It represents the views and opinions of the author It is not intended for use by any third party without the approval of Michael Hevern While this report is based on information from sources which are considered reliable its accuracy and completeness cannot be guaranteed Any opinions expressed reflect my judgment at this date and are subject to change Contracting Hevern Pty Ltd is a Corporate Authorised Representative No 408868 of D2MX Pty Limited ABN 98 113 959 596 AFSL No 297950 D2MX and Michael Hevern has been appointed as an Authorised Representative of Contracting Hevern Pty Ltd Opinions conclusions and other information expressed in this report are not given or endorsed by D2MX unless otherwise indicated The information contained in this Report is General Advice only as the information or advice given does not take into account your particular objectives financial situation or needs Disclaimer Using leverage to invest can be a two edged sword as it can magnify your returns when the stock price rises but will in turn magnify the losses if the trade does not perform as expected TABLE 1 Returns for Telstra ending at various levels 3 00 3 25 or 3 75 at the end of the 12 month period Cost Price 3 25 Contact me at D2MX Trading on 1300 610 024 Tags d2mx Dividends high yield Investment leverage margin loan Telstra trading shares Trading Strategy Posted in Stock Market Analysis Trading Strategies No Comments Shorting With Limited Risk Using MINIs Part 1 of Warrant Trading for All Types of Market Environments Friday April 13th 2012 There is an old adage Sell in May and go away which has served investors well in the past couple of years with the ASX 200 slumping 18 in 2010 and last year plummeting 25 from its April peak So we thought it timely to discuss how you can trade Short in the market that is profit from falling share prices while at the same time limiting your risk In earlier articles we ve discussed how you can use options to trade the market short and today we re talking about MINI Warrants MINI Warrants MINI warrants are a new trading instrument gaining in popularity allowing you to trade the market short or long with a predetermined risk The MINI trading warrants have been designed to compete with the CFD market and have a number of features that make them a far superior product as outlined below The MINIs market was established in 2007 by RBS and last year Macquarie Bank and Citigroup joined in to expand the MINI warrant offerings The MINI warrant market gives you exposure to ASX200 stocks Indices ASX200 SPI Dow Jones S P500 NASDAQ HANG SENG etc Commodities Gold Silver Copper and Oil and Currencies EURUSD GBPUSD AUDUSD AUDEUR AUDGBP etc MINIs have a six letter code eg BHPKMD The first three characters identify the stock the fourth identifies the warrant type K MINI the fifth refers to the issuer and the last character signifies the series or leverage One of the major risks with trading CFDs is that you stand to lose more than 100 of your initial outlay if the market gaps against you We discussed these perils in the article Mind the Gap Trading Risk with Options Versus CFDs MINI warrants are a type of warrant listed on the ASX They are a CFD style trading instrument that provides investors with a 1 for 1 participation with the underlying asset ie a 1 cent rise of fall in the stock price equates to a similar 1 cent move in the MINI Investors can choose their level of leverage based on their own risk profile as there are a number of MINIs or leverage levels available for each stock Before trading MINIs traders need to read and understand the ASX Understanding Warrants Booklet and then sign the Warrant Agreement form Speak to your broker or contact us at D2MX on 1300 610 024 Key features of MINIs MINIs are traded and regulated on the ASX Securities Exchange You can trade long and short directional moves simply There are no margin calls There is no optionality since there is no expiry date though there are financing charges Transparency through 1 for 1 participation between the move in the underlying asset and the MINI No expiry dates open ended investments MINIs present an efficient way to short sell and can be used for hedging existing share positions No credit checks or approvals required In summary MINIs are a geared product that are listed on the ASX have known risks are simple flexible and transparent and there is no risk of a margin call You should note that simplicity a regulated market on the ASX and the predefined trade risks are the major advantages over the CFDs MINI Warrant Terminology The MINI warrant is made up of 3 parameters The MINI Value the prices at which it trades The Strike Price indicates the loan amount The Stop Loss price the price at which the MINI ceases to trade and the position is closed out MINIs Valuation Value of MINI Long Reference Asset Price Strike Price Conversion Factor eg For a 50 stock with a MINI Strike Price of 40 the MINI Long Value 50 40 10 ie leverage is 80 Value of MINI Short Strike Price Ref Asset Price Conversion Factor Note the Conversion Factor for Stocks is 1 The Strike Price Reflects the amount of leverage loan amount Is adjusted daily for financing cost Dividends and index futures roll are reflected in the strike and the stop loss level The Stop Loss Price Is the price at which the MINI ceases to trade and the position is closed out The PDS document details how this is done Case Study Sam owns 1000 CBA shares that he has held since CBA first floated In mid February after CBA had gone Ex Div 1 37 Sam believed that CBA shares would see some further weakness in the following weeks and decided to hedge his position when CBA bounced back to 49 50 Note that when you trade MINIs short you are actually rebated interest on your position in this example we have used a 1 p a rebate After a couple of weeks CBA did in fact trade lower and Sam closed his position at 47 50 after 15 days for a profit The profit on the MINI Short position offset the losses on the 1000 CBA shares so the portfolio position at the end of the 15 days is as follows So Sam got to hold onto his CBA shares avoiding a capital gains tax event and got to keep his dividend as well The Trade If you are of the opinion that this is a Sell in May and go away trading environment then the MINI warrants are an excellent way to participate As shown in the case study MINIs are a great way to hedge current portfolio positions too MINIs can be used to trade stocks Long as well as we will discuss in later articles For help trading this new product contact me on 1300 610 024 Each MINI warrant has a PDS document which details all the features of the specific warrant Note that before trading MINIs traders need to read and understand the ASX Understanding Warrants Booklet and then sign the Warrant Agreement form or contact us at D2MX now on 1300 610 024 Warrant Trading for All Types of Market Environments Series Part 1 Shorting With Limited Risk Using MINIs Part 2 Boosting Dividend Yield Using Warrants Michael Hevern Investment Adviser D2MX Retial Trading This report was prepared by Michael Hevern It represents the views and opinions of the author It is not intended for use by any third party without the approval of Michael Hevern While this report is based on information from sources which are considered reliable its accuracy and completeness cannot be guaranteed Any opinions expressed reflect my judgment at this date and are subject to change Contracting Hevern Pty Ltd is a Corporate Authorised Representative No 408868 of MDS Financial Services Pty Limited ABN 28 088 190 283 AFSL No 333298 MDS and Michael Hevern has been appointed as an Authorised Representative of Contracting Hevern Pty Ltd Opinions conclusions and other information expressed in this report are not given or endorsed by MDS Financial Services Pty Ltd unless otherwise indicated The information contained in this Report is General Advice only as the information or advice given does not take into account your particular objectives financial situation or needs Tags asx trading CFDs MINI mini warrants trading short Trading Strategy warrant markets Posted in ASX Trading News Trading Strategies No Comments Trading For Profit Friday March 23rd 2012 Trading for profit isn t that what we all endeavour to do Last week in his article Managing Trading Stress Jeff talked about the importance of managing stress in your trading life This week we elaborate on trade preparation As traders we apply our knowledge and skills to profit from trading Trading should be treated as a business and as such there are a number of rules and conditions that you need to abide by in order to ensure that your trading is done systematically and efficiently without emotion Some of these rules include 1 Planning the trade Before the trade is initiated have a written plan specifying the entry and exit conditions the dollars you are prepared to put at risk for the trade and how you will manage your profits losses Note how you expect to exit the trade whether it s a staged exit to protect profits as the trade goes in your favour or when the trade goes against you necessitating you taking a loss Just remember that as a general rule the first loss is often the cheapest and having a clear exit strategy before you enter the trade can save you a lot of stress 2 Keep consistent and accurate trading records Trading should be treated as a business therefore you should be able to measure its success regularly by reviewing your records depending on your investment time horizon 3 Journal your trade Note the entry and exit parameters before you enter the trade Write down the trading signals the ideas behind the trade and the emotions about your trade Journal comments on the trades can be an excellent reference if and when you want to evaluate your trading success failure 4 Remove distractions If you are trading part time and are called away to meetings or phone calls just consider that there are full time professional traders who are concentrating on taking your money Set aside time for trading including preparation time and remember that the trading plan journal and record keeping are essential in any business venture 5 Be systematic Select your trading system or systems You can run a number of systems concurrently that allow you to profit in different market conditions An example of concurrent systems would be using a trend trading system with a breakout system and a mean reversion system Master your own systems don t tinker with indicators of a system that you re trading and back test before you start putting your capital at risk 6 Keep your losses small Understand your trade expectancy and know your trade risk before you enter the trade When all is said and done the only parameter that you can control in any given trade is your risk It may be worth reviewing my previous article Mind the Gap Trading Risk with Options Versus CFDs at this point 7 Staying on the sidelines is a valid strategy If the market and or stocks are trading sideways it is valid to stay in cash until a trading opportunity presents itself 8 Take responsibility for your trades Evaluate why the losing trades failed and why the winners succeeded This is where a Trade Journal can be invaluable This can be a painful process at least initially because ego is built to deflect blame and accept praise which is a trap because if you try to rationalise or justify poor trades then you will never learn from them Use the Trade Journal to divest the emotion from the trade evaluation process Trading for profit should be treated as a business and these are just some of the rules and conditions that you need to abide by in order to ensure that your trading is done systematically and efficiently without emotion Some good reading material on this topic includes Complete Trading for a Living by Dr Alexander Elders Trade Your Way to Financial Freedom by Van K Tharp Michael Hevern Investment Adviser This report was prepared by Michael Hevern It represents the views and opinions of the author It is not intended for use by any third party without the approval of Michael Hevern While this report is based on information from sources which are considered reliable its accuracy and completeness cannot be guaranteed Any opinions expressed reflect my judgment at this date and are subject to change Contracting Hevern Pty Ltd is a Corporate Authorised Representative No 408868 of MDS Financial Services Pty Limited ABN 28 088 190 283 AFSL No 333298 MDS and Michael Hevern has been appointed as an Authorised Representative of Contracting Hevern Pty Ltd Opinions conclusions and other information expressed in this report are not given or endorsed by MDS Financial Services Pty Ltd unless otherwise indicated The information contained in this Report is General Advice only as the information or advice given does not take into account your particular objectives financial situation or needs Tags investing in shares stock market trading trade journals trading as a business Trading Strategy Posted in Trading Strategies No Comments Where to now for the Aussie market Friday February 24th 2012 The Aussie market has basically been trading sideways for the past three years and is currently at the same level as it was back in July 2009 No wonder investors have become frustrated If you have been actively trading this market in the past six months you will no doubt have found it challenging to hold on to gains particularly if you have been trading the large cap stocks say ASX top 20 The 4300 level remains a major resistance level The Aussie market has been underperforming in relation to other global markets for some time There are a number of factors that have contributed to this The high Aussie dollar which is providing a headwind for overseas investors who want to trade in our market as well crushing the returns of our companies with overseas earnings The two speed economy east versus west which is impacting growth in the various states and employment The sluggish housing sector as investors wait for that next rate cut Disillusioned retail customers who are ditching the bricks and mortar retail suppliers for online shopping The political environment generating uncertainty Chart Aussie SPI Futures A chart of the Aussie SPI futures index shows why it has been so hard to generate consistent returns The term SPI is an abbreviation of ASX SPI 200 Index Futures contract which is a composite index over the Top 200 ASX stocks The SPI is in what is called a symmetrical triangle formation This type of pattern generally forms in a period of consolidation before price builds up enough momentum to move beyond one of the identified trendlines A break below the lower trendline will signal weakness and often triggers a move lower while a break above the upper trendline signals buying strength and a move upward As you can see from this chart the sharp moves within the triangle have been predicated by a sharp increase in trading volumes The stochastics indicator also defines overbought and oversold Edwards and Magee in their book Technical Analysis of Stock Trends concluded that approximately 75 of symmetrical triangles are continuation patterns and the rest mark reversals however these reversal patterns can be especially difficult to analyse and often have false breakouts They also said that you should not try to anticipate the direction of the breakout but rather wait for it to happen and utilise additional technical indicators for confirmation of the breakout such as trading volumes and or stochastics For the patient investors prices sometimes return to the breakout point at the apex of the triangle in a reaction move before resuming in the direction of the breakout If this setup occurs it can offer the trader a second chance to participate in the move often with a better reward to risk ratio Planning the Trade In order to trade the index you must evaluate the current symmetrical triangle pattern and be prepared to react to any breakout Trend As stated earlier the Aussie SPI is trading sideways so this symmetrical triangle cannot really qualify as a as a continuation pattern in an established trend The index is at the same level as it was back in July 2009 Pattern As highlighted on the chart we are in a symmetrical triangle pattern which has been in place for the past six months Volumes Trading volumes have been anemic in the most recent run up of the index This can be interpreted in two ways 1 there is a lack of conviction in this move or 2 volume may surge with a confirmed move higher due to the lack of participation in the current market and investors find themselves under invested in equities and move to chase performance Duration This pattern has been in place for many months Breakout Time Frame The ideal breakout point occurs ½ to ¾ of the way through the pattern s formation Ideally you look for a break between the ½ and ¾ way point as a break too close to the apex may be insignificant As you can see this breakout for the SPI will occur close to the apex and therefore may lack momentum to provide a significant move Breakout Direction Can only be determined after the break has occurred and it is dangerous trying to predict the direction prematurely Breakout Confirmation A valid breakout requires a close above below the trendline More conservative traders will require a greater than 3 price break and or the break is sustained for at least three trading days Return to Apex After the breakout up or down the apex can become future support or resistance The price sometimes returns to the apex or a support resistance level around the breakout before resuming in the direction of the breakout If this does occur it offers a substantially improved reward and risk trade setup Price Target You can calculate a price target either by taking the widest distance of the symmetrical triangle that can be measured and applied to the breakout point or by drawing a trend line parallel to the pattern s trend line that slopes up or down in the direction of the break and the extension of this line will mark a potential breakout target Conclusion Our market is setting up to break in either direction possibly near term The 4300 level is crucial for a break to the upside and a break below 4180 could prompt a retest of the recent lows Last week Jeff talked about overbought markets and this is well worth a read Our reporting season has triggered some major short covering rallies of late e g Onesteel particularly in the mid cap companies So watch to see whether momentum in these stocks can translate into buying of our larger caps Look to trade stocks outside the Top ASX 100 in order to outperform the market index and utilise options strategies to boost the returns from the large cap ASX stock MDS Financial Advisory Service offers general advice on trading options to generate consistent steady income

    Original URL path: http://blog.traderdealer.com.au/tag/trading-strategy/ (2013-02-02)
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  • Derivatives Trading | Online Stockmarket Trading Update
    Wrap The Covered Call Collar Part 3 1 of Options Trading for All Types of Market Environments Stock Market Analysis Markets Cap Best January for Over a Decade Stock Market Analysis Traders Take Profits Stock Market Analysis Markets Reach Bull Market Territory Stock Market Analysis US Markets Ease Near All Time Highs Markets Higher As Investors Play Catch Up Weekly Market Wrap Investing in 2013 continued Part 9 Stock Trading Tips for All Types of Market Environments Stock Market Analysis Markets Higher As Investors Play Catchup Stock Market Analysis Markets Cautious Ahead Of Chinese Data Archives February 2013 January 2013 December 2012 November 2012 October 2012 September 2012 August 2012 July 2012 June 2012 May 2012 April 2012 March 2012 February 2012 January 2012 December 2011 November 2011 October 2011 September 2011 August 2011 July 2011 June 2011 May 2011 April 2011 March 2011 February 2011 January 2011 December 2010 November 2010 October 2010 September 2010 August 2010 July 2010 June 2010 May 2010 April 2010 March 2010 February 2010 January 2010 December 2009 November 2009 October 2009 September 2009 August 2009 July 2009 June 2009 May 2009 April 2009 March 2009 February 2009 January 2009 December 2008 November 2008

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  • Online Trading | Online Stockmarket Trading Update
    technical issues that they encounter Users can now opt to ignore the Time Out setting when requesting Chart History This helps users with sub optimal internet connections to use the software At this time you need to contact Customer Care to assist with turning this feature on Fixed a chart bug that was affecting the highlighting of Trendlines Rectangles and Ellipse Indicators when you hovered over them with your mouse cursor The Chart system is now better at detecting attempts to load corrupt Saved Charts and Templates and will display a message detailing the issue Numerous other technical fixes and optimisations to make the program more stable June 13 2012 Release 75 Fixed issue with Chart Engine changes not being detected May 29 2012 Release 74 Program now detects freezing and previously unhandled errors A new window will prompt the user to submit the issue to our Customer Care team to assist in resolving the problem Fixed bug with plotted scripts that use images Added Messaging Function to allow us to communicate urgent System Messages to all users Fixed bug with Browser Windows not closing correctly sometimes causing the program to hang Made some window titles shorter so that they re more relevant and readable for users Intraday charts now update their volume as new trades take place Weekly and Monthly charts now show updates as new trades take place May 28 2012 Release 71 Analyser Filter settings are now saved and loaded when you re open the Analyser window Current Analyser Indicators are saved as part of the Persistent Settings so each Analyser window will load the last Indicator and with the values you last specified As you switch Indicators in the Analyser the system saves the parameters you last changed and loads those changes again as you re select that indicator Real Time Data updates now include best Bid Ask Change Percent Change and Value Chart Captions are now updated with Range Spread Net Change and Percent Change values Default Chart Caption is Last Price and Change Not yet possible to select other caption options Added extra white space to Chart Titles with updates to clear old values that may have had longer strings May 14 2012 Release 70 Improved handling during startup the program now checks if it s already running and if so displays a message then quits The installer will now check if the program is running before copying files and will prompt the user to close the program before continuing Improved handling of Java the installer will now check for Java 1 6 update 31 runtime If a lower 1 6 update is installed it will attempt to download 31 onto the client machine May 4 2012 Release 69 Fixed an issue in the Analyser window where filter settings weren t fully visible if the user had an unusual DPI or font size setting in place Fixed a bug where Chart Indicator images weren t selectable nor being loaded during the drawing Modified the installer to better handle 64Bit systems Fixed a bug with the program not reading the Install Location correctly causing a Chart Image Toolbar error Fixed an issue with the Enter Key not working when using web page based windows Improved management of timeout and other unhandled Iress Time Series errors Added a popup message to display if loading of Time Series data fails giving the user the option to try again or load other data Added an Update Progress bar to display while the software update process runs Local filename for a downloaded update is now randomised to correct any Operating System sharing conflicts May 2 2012 Release 66 Analyser scans now have a Filter Option to restrict symbols based on price and volume limits Fixed a bug preventing intraday charts advancing to a new day if opened before the new session starts Improved error handling in Analyser Script Execution to assist in cases of a script error stopping the scanning process Modified the Analyser Progress Bar settings to address an intermittent range error D2MX Trade Tools task bar icon is now hidden when no Trade Tools windows are open Fixed a bug in chart indicator polylines preventing user interaction with the line via a mouse This fixes the issue of the SAR indicator not being clickable Added Chart Title to the Custom Index indicator Added error handling to prevent D2MX windows being deleted if a user is holding down the Shift key on startup The program will play a sound if it detects the Shift key being held The Analyser window now repaints during scans to ensure screen updates will be shown while a scan is in progress April 23 2012 Release 64 Fixed a bug in intraday charts where updates were being skipped if the volume was zero This was affecting FX and some Index intraday charts April 16 2012 Release 63 Added the ability to scroll through Watchlists Improved method of handling Java settings to give more useful information on the version of Java installed Adjusted the IRESS Loading timeout setting April 2 2012 Release 62 Fixed an issue in the Upgrade Tool preventing some watchlist data from older versions being imported into Market Analyser 7 Added a facility to delete all Trendlines Rectangles and Ellipses on a D2MX Chart These options are now accessible via the right click menu Rearranged the D2MX Chart right click menu for improved ease of use Fixed a bug with D2MX Chart Indicators which was causing charts with indicators to stop drawing if another indicator had encountered an error in calculations Release 61 Added the Always Save option to the right click menu on D2MX Charts Improved handling of how the system checks for a valid installation of Java Tabs on D2MX Chart Templates were hard coded to use a small hard to read font This has been changed to use the Windows Standard Font Size The system will now detect if a user s Microsoft XML 4 installation is corrupt

    Original URL path: http://blog.traderdealer.com.au/tag/online-trading/ (2013-02-02)
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