Protection

Resource Investing with Long-term Options
August 01, 2018
Protection

Resource Investing with Long-term Options

Patrick Ceresna

Old Truism: “A bear market is the author of a bull market and a bull market is the author of a bear market”.    During our interview on MacroVoices with resource investing legend Rick Rule, Rick made a core observation that natural resource investing is different than most mainstream forms of investing. To paraphrase,...

405
0
2
5 months ago
Hedging With SXO Options Using Portfolio Beta
July 30, 2018
Protection

Hedging With SXO Options Using Portfolio Beta

Jason Ayres

This year has been one of headline risk and investor hypersensitivity to say the least. Yet despite all the market moving tweets and the ongoing trade tantrum, both U.S. and Canadian markets continue to climb a wall of worry. In fact, I would suggest that global markets in general have been climbing a wall of worry since 2008....

567
0
1
5 months ago
Using call options as a hedge
May 16, 2018
Protection

Using call options as a hedge

Martin Noël

As can be seen in the following chart, the share price of ONEX Corporation (ONEX) has been weak enough to suggest that some caution may be necessary. The Relative Strength Index (RSI), which was recently in oversold territory, is trending downward. The same is true of the stochastic oscillator (%K). Although the scope of the...

872
0
1
7 months ago
Buying Put Options to Hedge Shares
March 19, 2018
Protection

Buying Put Options to Hedge Shares

Martin Noël

As the following graph shows, shares in Waste Connections Inc. (WCN) have been rallying since February 6, 2018, when they bottomed out at $81.52. As I write these lines, WCN is priced at $96.67, up 18.58%. The RSI indicator and stochastic oscillator are now in extreme overbought territory. Even though this is not, in itself, an...

931
0
Like
9 months ago
Locking In Profits on a High Flyer
January 12, 2018
Protection

Locking In Profits on a High Flyer

Jason Ayres

Once again, despite the risk of controversy, I find myself compelled to write about pot! In my last article, Embracing Volatility on a Canadian Disruptor, I looked at a couple of ways one might participate in a bullish technical pattern developing in the TSX:WEED price chart. At the time (August 28th, 2017) the shares were...

1006
0
Like
11 months ago
Writing covered calls as a hedge against a drop in the shares of Intact Financial Corporation
January 11, 2018
Protection

Writing covered calls as a hedge against a drop in the shares of Intact Financial Corporation

Martin Noël

As the following graph shows, the share price of Intact Financial Corporation (IFC) seems to be on a downward trend as it has just broken through its previous trough at around $104. Its stochastic oscillator (%K) and relative strength index (RSI) are also trending downward. Since this bearish trend could take IFC down as far as...

924
0
Like
11 months ago
Implementation of a collar to protect profits accumulated in Royal Bank of Canada shares
October 20, 2017
Protection

Implementation of a collar to protect profits accumulated in Royal Bank of Canada shares

Martin Noël

As you can see in the following graph, the price of shares in Royal Bank of Canada (RY), much like the financial sector in general, have shot up over 10% in just six weeks. Even though it is always risky to expect a trend to reverse, such growth cannot continue indefinitely. However, considering that RY just closed at $100.07...

1092
0
Like
1 year ago
Hedging Canadian Bank Risk with Debit Spreads
August 01, 2017
Protection

Hedging Canadian Bank Risk with Debit Spreads

Patrick Ceresna

The recent hawkish shift and rate hike by the Bank of Canada has ushered in a resounding 10% rise in the Canadian dollar in a few short months.  This has not only put stress broadly on Canadian equities, but it has instilled concerns about the tightening of credit conditions on an already over indebted Canadian consumer....

970
0
Like
1 year ago
Options Brief- Week of July 31st
August 01, 2017
Index Options

Options Brief- Week of July 31st

Montréal Exchange

The rallying markets have led to a large pool of investors accumulating unrealized gains on their portfolio. One may believe that now is a good time to cash in a profit, but investors may wish to hold on to their stocks just a little longer if they are receiving a healthy dividend payment from these holdings or wish to avoid...

738
0
Like
1 year ago
Delta: Assessing Probabilities Based on the Break-even price
May 07, 2017
Concepts

Delta: Assessing Probabilities Based on the Break-even price

Martin Noël

As we saw in an earlier article, delta measures how much an option’s price moves in relation to a change in the price of the underlying asset. Delta is a variable from the Black-Scholes option pricing model, and it is also used in the industry as an approximation of the probability that the option will be in-the-money at...

1968
6
1
2 years ago