Financial Solution News

Today and tomorrow is the last days to sell losing investments because you can deduct taxes from it. In the US, we are taxed on net capital gains for the year, which means that we should sell stocks that we have a capital lost in to offset all the capital gains, minimizing taxes. The government encourages this in fact, because not only can we balance it just right so we don’t pay ANY taxes for stocks we made money on, we can even get tax credit for a realized capital loss! Let me illustrate in the following example of what I mean.
Say in 2007, I bought $7,000 worth of Diamond Offshore (DO) and $15,000 worth of ETrade (ETFC). Now, DO is worth $15,000 so I decided to sell it, making $8,000 on the investment. However, ETFC is only worth $3,000. If I don’t sell ETrade, it means that I will [...]

Original post by MoneyNing

Could it be that one of my worst trades of the year will work out for me?  I sold three naked puts a few months ago on DWA only to see it drop big.  During that fall I sold six calls on it.  Three of those calls were covered with my shares gained through my naked puts and three were naked.  I screwed up with writing the calls and sold at market price which gave me an fill price less than the bid (thanks TD Ameritrade). 
 

 
You can see in the chart above where DWA started to make a turn back up when it left the oversold area on the %R indicator and then it broke through the down trending line and finally it crossed over and held support above the 10 and 20 day moving averages.  I think a bullish crossover of these two lines is only a couple of days away.  [...]

Original post by Alex Fotopoulos

Good is the enemy of the best
Too many options causes a paralyzing effect. I recently read about a bicycle shop owner who carried about 35 different models. He decided to simplify things in his store by eliminating all of the “good” bikes and only selling the best in each “category.” He had found that most of his customers fell into 1 of 6 categories of buyers: e.g. high performance, high durability, budget bike, etc. He ended up only selling 6 different models, but each one was the best he could find for each type of customer. Once he made this change, his sales sky-rocketed.
There is a freedom that comes with having fewer options. The bicycle shop owner had figured out that some of his customers were experiencing a paralyzing effect from being overwhelmed with all of the options. By eliminating even a bunch of “good” options, he simplified his [...]

Original post by bob

Had I waited a few minutes I could have included this trade in my last post.  I keep coming back to NVIDIA (NVDA) and it keeps working, so let’s hope I’m not pushing my luck (skill?) with this order.
While NVDA was trading at 35.86 I sold four February 32.50 naked puts (UVANZ) and received $507.00 after commissions.  With implied volatility on this option over 52, I saw no need to be greedy and try for the Feb 35 strike. 
My DSX trade last hour and now this NVDA trade brought in over $1,000 for the day.  That means it’s time for a walk/run on the treadmill and then eat lunch.  I doubt I’ll trade any more today and will watch these two to make sure I get to keep as much of that $1k as possible through expiration two months away.

Original post by Alex Fotopoulos

Yes, that was an intentional pun – sales/sails – maybe not as funny if I have to explain it. 
DSX was trading at 29.17 when I bought my December 30 naked puts back last week.  It finished the day lower on that Friday and then rebounded on Monday.  Today it’s down again and I watched it for most of the morning.  This time I was focusing in on the 25 strike instead of the 30, again to give me a good cushion like I thought I was doing for the December expiry.
While DSX was trading at 28.87 this morning my limit order hit and I sold five February 25 naked puts and received $536.25 after commissions.  I started with an order at 1.25 and ended up lowering it all of the way down to 1.10 before it hit.  I actually think DSX will recover and be above 30 by February, but [...]

Original post by Alex Fotopoulos

DSX was trading at 29.17 when I bought my December 30 naked puts back last week.  It finished the day lower on that Friday and then rebounded on Monday.  Today it’s down again and I watched it for most of the morning.  This time I was focusing in on the 25 strike instead of the 30, again to give me a good cushion like I thought I was doing for the December expiry.
While DSX was trading at 28.87 this morning my limit order hit and I sold five February 25 naked puts and received $536.25 after commissions.  I started with an order at 1.25 and ended up lowering it all of the way down to 1.10 before it hit.  I actually think DSX will recover and be above 30 by February, but I was wrong about it for December (although I finished the trade with a profit) and decided to [...]

Original post by Alex Fotopoulos

Thanks to everyone who participated in the Christmas giveaway. It has been a lot of fun for me and I am going to start having giveaways on a regular basis. I haven’t figured out all the details yet, but I will let you know when I figure it out.
So, let’s hand out a few presents!!
YNAB Budgeting Software

 
The winner of the YNAB Personal Budget software is EDNA!!
 
 
iPod 4GB Nano
 
The winner of the 4GB iPod Nano is BRUCE!!
 
 
 
Michael W Smith “Christmas” CD
 
The winner of Michael W. Smith’s “Christmas” is CENTSIBLE SHOPPER!!
 
 
 
“Zen to Done”
 
The winner of the Zen to Done eBook is MRS. MICAH!!
 
 
 
“Fix ‘em up, Rent ‘em out”
 
 
The winner of the Fix ‘em up, Rent ‘em out book is Matt!!
 
 
 
Winners: I will be emailing you within a couple days so we can work out the details.
I will be getting back to my regular posting schedule starting in a couple days. I [...]

Original post by bob

How many of us have to work today and feel really bad?  How many of us are complaining that someone we know doesn’t have to work the same time we are grinding away?  Why do we even care what other people have or don’t have to do?
I’m sure this won’t make the rest of us feel much better, but I’m working right now while my fiancee is sleeping in bed.  If we think about it, our work day isn’t better or worst no matter what our friends are doing.  Some of them may be playing golf now, while some evil friends might even call you during the day to rub it in.  However, these are the times where our true character shows!
Think of the positive side.  Whether we are home or at work, we would be reading Money Ning anyway right?   In addition, we won’t be spending any money [...]

Original post by MoneyNing

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Original post by Admin

I’m keeping this week’s Dow Jones Industrial Average (aka DJIA or $INDU) brief this week since it’s a holiday week.  The chart below tells the same story as last week, we’re still stuck in a trading channel.  What we can’t say for sure yet is which way we are likely to break or even when yet.  I don’t think it will be in the next two weeks in either direction. 
A possibility exists that the markets could move big with volume low this week and next, but once the volume returns, a sense of normal behavior should come with it.  The best bullish indicator the DJIA saw last week was that we closed on Friday above the 10, 20 AND the 50 day moving averages for the first time since 12/10/07.  Until something big happens, I see the 13,000 range as likely (light) support.  I’m sticking with my neutral sentiment that [...]

Original post by Alex Fotopoulos