out of the money puts
BOCA RATON, Fla. (PRWEB) September 16, 2008
Many investors may be looking to pick the bottom on the banking sector, as well as determine those banks that may outperform the sector. Exchange Traded Funds (ETFs) such as XLF, the financial sector ETF, are a potential strategy for investors seeking protection, while still offering the possibility of upside in this turbulent sector. If trying to pick the bottom on the banks, investors might look to XLF with "out of the money puts" for protection, which allows investors to continue rolling the puts and taking profits, while waiting for an upside move. The Chicago Board Options Exchange Volatility Index (VIX) is at its highest level since early July. But history shows this "fear index" changes over the course of one 30-day period to the next. Selling "call spreads" that anticipate the VIX to decline is a potential strategy for investors to consider. Some investors may seek haven in certain "blue chip" stocks. Investors should look for stocks whose prices have moved up, but are still below yearly highs, potentially leaving room for more appreciation. Overby can share examples of where these types of conditions exist for investors to consider. To request an interview with Brian Overby, please contact Kathy Wilson at 781-652-0499 or firstname.lastname@example.org.
1 Any strategies discussed and examples using actual securities and price data are for educational and illustrative purposes only and do not imply a recommendation or solicitation to buy or sell a particular security or to engage in any particular investment strategy. In reading content on TradeKing's website, you may gain ideas about when, where, and how to invest your money. Although you may discover new ideas or rationale that may be compelling, you must ultimately decide whether or not to put your own money at risk. Consider the following when making an investment decision: your financial and tax situation, your risk profile, and transaction costs.
Exchange-traded funds are subject to risks similar to those of stocks. Investment returns will fluctuate and are subject to market volatility, so that an investor's shares, when redeemed or sold, may be worth more or less than their original cost.
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