Pessimism about the U.S. economy and financial market is so thick right now you could cut it with a knife. I’ll be the first to admit that times are tough. But Americans have seen tough times before. And we have always prevailed.
Readers often ask me the truth about options and the advisability of buying puts and calls on stocks.
Let me begin by saying that options are tools, nothing more. Tools can be used to build something. Or they can be used to tear something down.
The key is to understand and master your tools and, more importantly, not destroy wealth when your intention is to create it.
Let’s start by defining our terms…
The Difference Between Put & Call Options?
Here are the differences between put and call options:
Investors spend so much time thinking about risk and return they often forget to tax-manage their portfolio, says Alexander Green. But it’s easy to control how much you surrender to the IRS… without breaking the law. Alex gives five basic tips for maximizing your total investment returns after taxes.
Oxford Club’s Alexander Green says making the switch from mutual funds to ETFs can save thousands in taxes and expenses. Changing funds now can also help psychologically, by locking this year’s huge losses in the past. Alex lists eight ETFs that can “help turn market lemons into lemonade.”
At an Oxford Club chapter meeting in Asheville, NC last summer, an attendee asked me what I thought about Wall Street’s much-ballyhooed “structured products.” My answer was brief. “Not much.”
Oxford Club’s Alex Green explains how Wall Street’s supposedly safe structured products became an investor’s nightmare. In reality, they were just a gimmick. Alex says this just underscores why investors should be cautious of any product that comes with “guaranteed” returns.
When those of us on The Oxford Club’s Fall Foliage Tour – aboard the Crystal Symphony – reached Bar Harbor, Maine last week, the bright colors came to an abrupt end. At least, temporarily.
The weather was so nasty – and the water so rough – the tenders couldn’t take us ashore. It was just a cold, grey, wet, rainy day. The perfect day for a book, in other words.
So I spent the afternoon perusing money manager Ken Fisher’s new book “The 10 Roads to Riches.”
According to Fisher, a member of the Forbes 400, there are only 10 ways to get rich. (This is after discounting things you can’t control like a lottery win or a big inheritance.)
10 Roads to Riches
Here are…
In the October 6 issue of Forbes, columnist Claire Obusan tells the surprising story of Eli Broad:
“Broad should be a lot poorer this year. Worth $7 billion last fall, the insurance and housing maven saw his 46.6 million shares of AIG – received a decade ago when he sold his SunAmerica to the insurance giant for $18 billion – drop 70% between last summer and August 29, the day we priced the Forbes 400 (they’ve fallen much further since). That decline erased $2 billion from his personal balance sheet. But Broad’s net worth fell only $300 million. One reason: the soaring value of his 2,000-piece art collection. Comprising mostly contemporary pieces by artists like Jeff Koons, his collection was recently appraised…
Investors are human. They make mistakes. That is why hedging is so important, says Alexander Green. He says there are plenty of stock bargains out there right now, but most people are too scared to enter the market. Alex recommends using trailing stops to limit downside risk on these 13 cash-rich companies.
Market volatility has investors flooding into Treasury bonds. This has pushed yields down and created a once-in-a-lifetime opportunity in muni bonds, according to Oxford Club’s Alexander Green.
