When choosing an option, there are so many more options to choose from than even just a couple of years ago. Due to the increased interest in options, the number of options traded has dramatically risen. With the higher volume of options trading, changes have occurred that have given traders many more choices of options. One of the big changes is the expiration times that are available. We now have weekly options to pick from in addition to monthly options. The weekly options are not available for those stocks that […]

High P/E Ratio For beginning traders, we introduce a simple method of determining whether a stock price is fairly valued. This is done by taking the price of the stock and dividing it by the earnings per share (EPS.) The EPS is based on the company’s earnings over the last 4 quarters. The result of this calculation is called the P/E Ratio. We suggest that we would like to see a P/E under 20 to be considered fairly priced. Another consideration is warranted as well. What if the company’s earnings […]