Call Options
Options for RRSP and TFSA
Jason Ayres
It’s that time of year again, where investors thoughts turn to RRSP and TFSA contributions and taking advantage of growing their portfolio in a tax-sheltered or tax-free way. There are many ways to approach portfolio management. Often, when you ask a cross section of self-directed investors their answers will vary. Some...
Selling call options at resistance
Martin Noël
As we can see from the following chart, the share price of Canada Goose Holdings Inc. (GOOS) just hit the $90 resistance level after a major 50% rally in just one month. We can also see that the RSI (5) has fallen, while the stochastic indicator shows it is in overbought territory (%K ). This situation is an indication of a...
Navigating a Slippery Slope
Jason Ayres
As I begin to write, oil has suffered a precipitous top to bottom (bottom? maybe) decline of over 30% from the high this year. What drove it higher? The most common answer has been the possibility of U.S. sanctions on Iran. This caused significant concern of a shortage in supply. A market fearful of an oil shortage...
Writing covered calls is like collecting monthly rent from your tenant
Montréal Exchange
Owning an income property has its pros and cons. As a landlord, it gives you the right to collect monthly rent. You can also offset your rental income from the property’s related expenses. Plus, the property has potential value growth. Owning a rental property is a winning strategy on many levels. But there are also some...
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...
Commitment to Buy Stock Through a Ratio Spread
Martin Noël
As you can see in the following chart, the price of shares in Canopy Growth Corporation (WEED) appears to be stabilizing, for now, in a range between a high of $74.45 reached on September 5, 2018 and its most recent low of $52.80, reached on September 14. We can also see that its high of $48.72 on June 22 may represent a...
Purchasing put options based on a bearish flag
Martin Noël
As the following graph shows, in July 2018, Shopify Inc. cl. A (SHOP) reached a double peak at around $230. This slowed its momentum, with the stock subsequently falling to $172.90 to climb back up to its current level, $195.81, by Friday, August 10, 2018. This rally, which looks very much like a bearish flag, may be...
Writing call options on a second peak
Martin Noël
As the following graph shows, the price of shares in Restaurant Brands International Inc. (QSR) has performed very well since bottoming out at around $68 in April 2018. QSR is trading at $85.20 at this writing, so it is near its previous high, in the $86 to $88 range. As we can see, the overbought and negative divergence...
Selecting the Optimal Call Options
Martin Noël
As the following chart shows, the price of shares in Rogers Communications Inc. cl. B (RCI.B) has just broken through $63, which has been a major resistance level since April. While there can be no guarantees, this bullish trend could take the stock to another resistance level over the next few months, at around $70. ...
Setting up a bear call spread hedge using call options
Martin Noël
As the following graph shows, the price of shares in Canadian Pacific Railway Limited (CP) has just fallen below its 13 and 34-day moving averages and appears to be stabilizing at around $240. The graphs also show that the stochastic oscillator (the bottom graph) is clearly trending downward. Even though the stock may rally, it...
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