Volatility

Using options in times of market uncertainty
July 07, 2020
Bearish Outlook

Using options in times of market uncertainty

Martin Noël

In times of market uncertainty like we are seeing now, many investors turn to options for the protection they can provide. Although the markets have recouped a good portion of their losses of the past few months, we cannot rule out another plunge that could test the depths of the recent decline. The high volatility in today’s...

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1 month ago
Butterfly on Shopify
June 10, 2020
Concepts

Butterfly on Shopify

Patrick Ceresna

Recently the Royal Bank of Canada lost its title as our country’s most valuable company in terms of market capitalization. For two brief weeks, Shopify sat at the top of the heap.   Chart 1: Royal Bank vs. Shopify May 31, 2020 Source: Bloomberg   SHOP’s run has been a sight to behold.   Chart 2: Shopify...

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2 months ago
no-cover
April 23, 2020
Concepts

Understand the “Rule of 16”

Steve Sosnick

Professional options traders are really good at dividing and multiplying by 16.  That seems like a weird skill, but it is a crucially important one for anyone who wants to fully understand the terminology used in options markets.  No matter how you utilize options, the “Rule of 16” is critical for analyzing volatility,...

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4 months ago
Making the most of volatility in these uncertain times
March 26, 2020
Bearish Outlook

Making the most of volatility in these uncertain times

Martin Noël

In our last article we discussed how to reduce the risk associated with the time-value decay of options in a directional position. Now we will take advantage of the market meltdown to discuss the implied volatility in the price of an option, how it reflects the degree of market uncertainty over future price movements in the...

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5 months ago
What do Cannabis, Nelson Peltz and Hedging Have in Common?
April 04, 2019
Protection

What do Cannabis, Nelson Peltz and Hedging Have in Common?

Jason Ayres

On March 13th, Aurora Cannabis Inc. (TSX: ACB) announced that they had appointed Nelson Peltz as a Strategic Advisor to help explore potential partnerships and advise on the company’s global expansion strategy. This is a big deal given Mr. Peltz’s business history and reputation for delivering results. For more details...

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1 year ago
Perspective on the Volatility on Cannabis Stocks
October 01, 2018
Volatility

Perspective on the Volatility on Cannabis Stocks

Patrick Ceresna

Speculation is enthusiastically running wild in the Canadian cannabis industry over the last 2 years.  This has led to extraordinary volatility and gains for investors who seek a stake in the industry.  For this article I will refrain from offering my opinions to the merits of this investment and rather focus on sizing up the...

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2 years ago
Is Gold Breaking Out of its 4-Year Consolidation?
April 24, 2018
Volatility

Is Gold Breaking Out of its 4-Year Consolidation?

Patrick Ceresna

Over the last few years I have not been shy about my conviction that the gold bear market has ended.  There is no denying that the December 2015 lows for gold bullion at $1050.00 are now history, but the enthusiasm for the shiny metal has been left for the diehards as most of the speculative money has turned its attention to...

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2 years ago
Flying with Condors
March 15, 2018
Volatility

Flying with Condors

Alan Grigoletto

In a recent article we discussed how to get long volatility with the Long Option Straddle. In today’s piece we will discuss another less costly way to buy volatility with the Reverse Iron Condor. Condor strategies are named for the narrow-bodied and broad-winged bird that is primarily found in California. When diagramed, the...

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2 years ago
Reverse Ratio Call Backspread
March 14, 2018
Volatility

Reverse Ratio Call Backspread

Alan Grigoletto

In a previous article, “Bull Call and Bear Put Spreads” investors learned how to construct a simple 1:1 vertical spread. This week we will discuss how a ratio spread can be implemented and the risks and benefits of this strategy. A ratio spread is similar to a vertical spread in that it involves the simultaneous purchase...

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2 years ago
Perspective on Trading Options on Natural Resource Companies
February 27, 2018
Volatility

Perspective on Trading Options on Natural Resource Companies

Patrick Ceresna

After our interview with Rick Rule on MacroVoices, I was inspired to share my thoughts on options trading on natural resource companies. At the start of the interview Rick pointed out the unusually cyclical nature of resource investing.  Rick went on to elaborate: “…during periods of time when mature natural resource...

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2 years ago
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