The RIM Death Spiral “Redeux”!
I am sure many of you will remember the blogs I posted last year on Research in Motion (TSX: RIM, Friday’s close $17.61). Too bad really… as I am trying to forget much of what I said! Especially my comments in the July 3, 2012 blog (The RIM Death Spiral!) where I talked about the possibility of the company going the way of...
Timing A Straddle
Last week I talked about the outlook for the markets in 2013. Specifically that we will likely see long periods trading within an ever narrowing channel punctuated by short bursts of volatility where markets move sharply before settling in a new trading range. Mind you that is typical market maneuvering in most years although I...
Cream and Sugar Please!
Back in February 2012 I talked about a covered call on Tim Hortons Inc. (TSX: THI, Friday’s close $48.65). I don’t talk a lot about this company because THI options are not that liquid so when positions are established you will likely have to maintain the position through expiry. In fact that is exactly what happened...
Investment Strategies for a Dysfunctional Government
There is an old saw on Wall Street known as the January barometer. The theory being that a strong stock market in January portends a rising market for the year. But like most theories actual results are hardly definitive! What we do know is that equity markets throughout 2013 will be influenced by government actions or lack...
Long-Term Options versus Margin
Long-term options (or Long Term-Equity AnticiPations or LEAPs as they are known within the industry) are interesting for more than the fact that they provide a demonstrative example of the option industry’s love affair with acronyms. LEAPs are long-term options with expirations that stretch beyond the nine month time line...
A Refresher on Calendar Spreads – Just in time!
Calendar spreads offer an interesting way to play fourth quarter earnings that will heat up in February. It will look even more attractive in February should the US come to some resolution on the fiscal cliff that keeps volatility low. The calendar spread involves the purchase of a longer term option – either calls or...
Volatility Skews
By the third week in November, US volatility futures were trading in backwardation. That is longer term volatility futures expiring in January and February were trading at lower values than the cash market. For traders who look to volatility as a way to gauge investor sentiment, that volatility skew can enhance one’s...
The Portfolio Approach
Avoiding the madness of crowds Usually in this space I discuss specifics related to an option strategy one might use based on a view of the underlying stock, or provide an educational gem related to option pricing, strategy or mechanics. This week I want to step back and address a broader issue related to portfolio building....
Never Say Never!
In October 2010 I penned the following comments: there has “never” been a market anywhere anytime that didn’t revel in the prospect of easy money! Which is to say: one should never fight the Fed. At that time, most of the industrialized world was engaging in massive stimulus programs designed to keep economies from...
Is the Door Slightly Ajar?
Well its official… the US did not fall off a cliff as a result of the recent Presidential election. Despite the socialist rhetoric that preceded the election and the subsequent post-election ostentatious victory claims from both side of the aisle (note: Republicans point to their victory in Congress as evidence that the...
Richard Croft
President, CIO & Portfolio Manager
Croft Financial Group
191 posts
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