Long 2 ADP Nov 19 th Continue to hold as along as the put-call ratio buy signal is still in effect, which it is. If ADP trades at , then roll up to the Nov 19 th calls. Long 2 NKE Nov 19 th calls: Continue to hold as long as the put-call ratio buy signal is still in effect, which it is. Roll up again, to the Nov 19 th calls , if Nike trades at Long 2 SPY Nov 19 th calls: These were bought on the upside breakout to new highs after reversing from a long put bear spread.
Raise the closing stop to , basis SPY. Raise the stop to , basis SPY. Breadth, while not terrific, has expanded enough to cancel out those sell signals, so close this position.
We are holding without a stop while the takeover rumors play out. Send questions to: lmcmillan optionstrategist. Lawrence G. McMillan is president of McMillan Analysis, a registered investment and commodity trading advisor. McMillan may hold positions in securities recommended in this report, both personally and in client accounts. The information in this newsletter has been carefully compiled from sources believed to be reliable, but accuracy and completeness are not guaranteed.
The officers or directors of McMillan Analysis Corporation, or accounts managed by such persons may have positions in the securities recommended in the advisory. He is president of McMillan Analysis, an investment and commodity-trading adviser. ET By Lawrence G. Should I cut them out of my will? Close popup. Instinet's Anushree Laturkar to Win Inau From The Markets. Share this on:. Tweets by marketsmedia.
Related articles. Daily Email Feature. It is a calculated value and exists only on paper. The options only allow one to speculate on the price direction of the underlying index, or to hedge all or some part of a portfolio that might correlate closely to that particular index.
There are several important differences between index options and options on ETFs. The most significant of these revolves around the fact that trading options on ETFs can result in the need to assume or deliver shares of the underlying ETF this may or may not be viewed as a benefit by some.
This is not the case with index options. The reason for this difference is that index options are "European" style options and settle in cash, while options on ETFs are "American" style options and are settled in shares of the underlying security.
American options are also subject to "early exercise," meaning that they can be exercised at any time prior to expiration, thus triggering a trade in the underlying security.
Index options can be bought and sold prior to expiration; however, they cannot be exercised since there is no trading in the actual underlying index. As a result, there are no concerns regarding early exercise when trading an index option. The amount of options trading volume is a key consideration when deciding which avenue to go down in executing a trade.
This is particularly true when considering indexes and ETFs that track the same, or similar, security. This combination of high volume and tight spreads indicate that investors can trade these two securities freely and actively.
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Basic Options Overview.
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