Do you want the good news or the bad news? Like everyone else I have been trying to make sense of the latest events in the market. Is this just an overblown exaggeration or are we headed for another Great Depression. Like everything in the market, we are probably somewhere in between. Since I cannot predict the future (I’m so sorry to disappoint you), I thought I would try to present both an optimistic and pessimistic view of what the long term charts are showing me. That way you can […]

In tonight’s grad call we discussed the valuation of options.  When purchasing an option, all one sees is a price, but is that expensive, cheap, moderate?  How do we know if we are overpaying?   As a basic rule of thumb, when purchasing a 90 day OTM option, one should pay approximately 10% of the stock value.  That is to say, if we have a $60 stock, we can expect to pay about $6.00 for the option.  If we get the option for cheaper, hoorah for us; but overpaying for […]

I recently had a student who called, and told me they had just purchased thousands of shares of a company who had recently declared bankruptcy. I think it is important for us to talk about what may or may not happen.   With various companies going bankrupt, many people are asking what will happen to shares of those companies who are going bankrupt. There are a few different things that can happen to the shares.   Most the time the stock’s price will drop severely, and loose value. The value […]