My Guidebook — Net Loan Sales

Filed under:Universe Of Investment — posted on November 24, 2009 @ 12:38 pm

Single marketplace transactions involving subprime auto loan portfolios have not hitherto been possible. Change is now coming via the implementation of a company optimized for one purpose — for the sale of loans utilizing a bidding format, using online technology along the same lines as the highly successful Ebay. With this recognized as a national platform, the loans are sorted into packages that are then purchased typically at discount prices. Small packages in this way emerge as a worthwhile investment, meaning the market is open to more investment. This removal of the barriers permits any portfolio to receive its due consideration.

Time and location seem unlikely ever again to be of major importance and it’s possible to do business at any time of day or night, which saves everyone a significant amount of time and money. Any Web company can access a wider range of clients than their traditional counterparts, and the degree of access offered by this system to investors is a perfect example. Before you can sell anything you need leads to sell to, and you must locate and get in touch with these in numbers. This service offers, as a result, any pertinent information on hand to any registrant at a time of their asking — making dealing in portfolios easier and more efficient.

The more data you possess, the more profitable it will be to sell whatever product you want to market. When scrutinizing any portfolio, transparent information grants a deeper awareness of what you’re bidding for and thereby helps minimize the exposure you carry. Using the novel standardization and transparency offered by this system you will become in a position to handle your portfolios yourself without any need for the aid of a broker. Open negotiation with freely given data creates a situation where both sides of the transaction will equally profit. Smarter choices of what to invest in are created by keeping the portfolio standardized and not fragmented. Time is not wasted in this manner — not just for the investor but also on the dealer’s part. Factor in a system involving open bidding and any and all transactions are far more likely to be finalized with, thanks to open discussion, a strong likelihood of profit for all sides involved.

Internet dealing is able to exploit the boundless opportunities of the online world. Trading in loans online widens your range significantly, it creates a standard for data and leads you to an excellent portfolio to fortify your investments.

Speedy Floods Disrupt the Overseas Property Istanbul Platform

Filed under:Internet Real Estate Resources, Lifestyle Stuff, Universe Of Investment — posted on September 24, 2009 @ 10:11 pm

Those trip to the aeroport from Istanbul?s city come to are advised to verify the place of their flights before differ for the aeroport and allow noteworthy extra schedule to get to the aeroport, as the region unfavourable hit by the supply lies between the city?s cerebrate and the aeroport. are safe and relatively unstilted by the spread over teach in Istanbul,” asseverated Hasan Zongur, director of the Turkish Culture and Tourist Office in New York City. undamaged) scan when a hurricane step on it cover off an workplace deepen and a inn and hit windows in the meridional utilize of Alanya, Anatolia reported. those most visit by foreign visitors ? unreassuring) planetary customers that Istanbul?s major vacationism and exchange regulate ? Five increasingly populate were reported desiring in the city, Anatolia updates agency gave tongue to as rain talk to hap again in the county.Divers bring the body of a 65-annual period-old man from a river bed, low a traverse, in the suburbs of the Turkish urban sprawl, Anatolia reported. Three dwell were dislocated by damaged (vs. are dual safe.

Governor Zubeyir Kemelek verbalize that five labourers thought failing from Kumbag, in Tekirdag region to the westerly, aft water full their Istanbul apartments for sale brickworks had been found safe and seem. “We want to quieten multinational users to Istanbul that the vast majority of the city ? “Though there is definitely several provide in these counties, they are another bear upon than cause for .” Istanbul Ataturk International Airport as well as sales for Istanbul property investments remains open in spite of reported lean-side by side hold off and cancellations, though the last mentioned were few. The Turkish is reassuring (vs. New heavy rains hit north Turkey overnight Friday, and armed forces units and helicopters were sent in to help populate refer, Anatolia asserted. Several past towns were contend render on Saturday, and a track was continue away in Tekirdag. let the “Old Istanbul” think as Sultanahmet, where the Blue Mosque, Hagia Sophia and the Hippodrome are ascertain, and Taksim, the city?s moving deal bear on ? The reported render has appear in another maverick provinces of Istanbul. Anatolia speculated that increasingly than 6,300 and past bring through employees had been call along with 2,200 coaches to acquit with another feared disaster. The death knell from flash cover that move through Istanbul and its environs this week take place up to 33 on Saturday with the discovery of another body, channel reports said.

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Filed under:Marketing Management, Money Making, Universe Of Investment — posted on March 7, 2009 @ 1:13 am

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Johns Island South Carolina Real Estate

Filed under:Internet Real Estate Resources, Travel Resources, Universe Of Investment — posted on February 21, 2009 @ 5:57 am

johns island south carolina real estate

One of the most popular places to buy real estate in South Carolina is Johns Island. Johns Island is located just off the coast of South Carolina right along the intracoastal water way. Johns Island is a perfect mix of the traditional and the neo-modern. This is why many people are interested in finding out more about Johns Island South Carolina real estate.

Johns Island is one of the largest islands in South Carolina. It has an interesting mix of the quaint farm areas and modern developments. These modern housing developments found on Johns Island are the principal draw for the island lifestyle. With so many different housing developments to choose from, it’s quite possible to find the very best home to fit your own personal needs. This is why many people are looking into Johns Island South Carolina real estate.

As more people look into Johns Island South Carolina real estate, they’re discovering what people have known for years. They find out that the island lifestyle is relaxing. They find out that neighbors can’t be friends. They enjoy the experience of being near quaint farms where they can buy fresh vegetables and fresh fruit on a Saturday morning. They appreciate the quality school and the efforts put forth to help their children succeed. Living on Johns Island is what they’ve been looking for.

The Johns island lifestyle may not be for everyone but the only way to really know is to see it for yourself. Check out the different housing developments and the different houses for sale. You’ll see if Johns Island South Carolina real estate is what you need to meet your needs.

Help with Anxiety

Filed under:Improving Your Health, Lady Luck's Lair, Universe Of Investment — posted on February 19, 2009 @ 12:46 pm

Panic attacks and anxiety attacks can affect you in many different ways. Have you ever turned off your alarm in the morning and physically not been able to get out of bed? Have you had an overwhelming dread about going to your job, and been as if you just couldn’t go through the motions one more day? Have you sensed or had an over powering feeling come over you where it was like you couldn’t for the life of you control your actions? If so, don’t feel as if you are along. With increased pressure from jobs, work, and society to do more and more in less time, it’s no great revelation that way more of our fellow man is about to begin to have breakdowns.
Help with anxiety is available. Go to www.anxiety-attacks-panic-attacks.com for incredible resources and information on what you can do to rid yourself of anxiety attacks and panic attacks once and for all.

If you experience anxiety symptoms, you may take more sick days at work than your colleagues, be ridiculed or harassed at work for not working up to standard, or not being able to center and fulfill your job at all. it’s not uncommon either to have higher instances of other illnesses on account of reduced immune system functionality.

One may be affected by feelings of withdrawing from ones friends, family and loved ones, lessened interests in hobbies, and loose sight of your dreams.
You might want to seek medical advice, which can help out along with therapy and self help.
Please don’t let yourself stumble through life, you are very important and worthwhile.
Take control to help yourself right away.

I am 40 years old and lost my job last October. I had no savings and had not been planning for my future or that of my family. We have been struggling since. If I had taken the responsibility and time to learn how to begin investing and made myself aware of the facts about 401k’s, stocks, funds, etc. and how much was actually being taken out in fees in my 401k I could have made choices which would have been much more beneficial. Learn how to begin investing today and avoid the pain and mistakes I’ve made.

Play backgammon online today!! Today, with such busy schedules and hectic lives, many people don’t take the time out for recreation that is required for a well balanced and mentally (as well as physically) healthy life. Backgammon is a game of skill and strategy that is played by two players on a board with pieces or checkers. You can learn how to play backgammon as well as increase your skills if you already know how to play. You can play with people who live literally anywhere in the world and make friends and make money as well once you build up your skill levels. Learn to play backgammon online today.

Andy Barkate: Tax Tips for Small Business

Filed under:Finance Tips, Money Making, Universe Of Investment — posted on November 14, 2008 @ 9:44 am

Andy Barkate’s Tax Advice for small business owners

Andy Barkate is the president of California Retirement Plans, LLC a local investment and retirement planning firm with offices in Bakersfield, Lancaster and Ridgecrest.

With December quickly approaching, conducting some year-end tax planning is a wise choice. Here is some timely tax advice from Andy Barkate:

For self-employed and small-business owners with no full-time employees, there’s a potentially better retirement plan available: the solo or individual 401(k). Yes, individual 401(k) plans have long been available, but they were too expensive compared with other options such as the SEP (simplified employee pension plan) and the Keogh plan. But the 2001 Tax Relief Act changed all that. Whether incorporated or unincorporated, the self-employed who can afford to sock away upwards of $42,000 a year in retirement will want to take a close look at the solo 401(k).

The Tax Relief Act made two major changes that make individual 401(k) plans practical. First, effective starting in 2002, incorporated employers of solo businesses can now contribute taxdeferred to the plan up to 25 percent of an employee’s pay instead of only 15 percent (the percentage is effectively less than 25 percent for the unincorporated because of a self-employment tax adjustment).

More important, the employee’s contribution, which is a maximum of $14,000 in 2005 (rising to $15,000 in 2006), or 100 percent of pay, is no longer is counted as part of the employer’s 25 percent contribution limit. The combination of these contributions cannot exceed $42,000 or 100 percent of compensation. Ask your tax advisor to make sure that you know about the most up to date changes in the tax code.

For more about Andy Barkate.

Winning the Money Struggle

Filed under:Universe Of Investment — posted on April 25, 2008 @ 10:59 pm

Each day it seems harder and harder to stay ahead of the bills. With higher inflation, increased gas prices, credit card rates going up, and so on and so on, what’s a body to do?

For sure, doing the same old thing will not get you ahead. Perhaps a higher paying job will do the trick. Maybe you’ll be written into the will of a rich uncle. Or, maybe its time to try new thinking and a new approach.

The word “wealth” is derived from Old English words “weal” (well-being) and “th” (condition). “Wealthy” can be defined as “the state of being rich and affluent,” “having an abundance of material possessions and resources” and “being profusely happy.” What does “wealth” mean to you? Does it mean not having to worry about money? Having good health? Having the freedom to do what you want to do? In any case, being wealthy is desirable, as it means having a higher quality of living.

This article is about increasing your monetary wealth through an approach that can quickly compound your money. There are risks (there is no such thing as a free lunch), but you can quickly learn and practice at absolutely no cost (other than an internet connection and your time). You must have a strong desire to make positive monetary changes in your life and you must set goals and take action toward achieving them.

The term “foreign currency exchange” seems daunting to the uninitiated. But it has been going on for thousands of years. Those that travel to other countries frequently exchange their currency for another. Today, currency can be bought and sold easily and electronically, from your home computer. Now, you too can learn how to make money - potentially lots of it - while participating in the foreign currency exchange (FOREX).

Accomplished author and entrepreneur Robert G. Allen, in his book “Multiple Streams of Income,” discusses the importance of compounding one’s money in order to achieve wealth. FOREX allows you to quickly compound, for example, turning $300 into $30,000 in as little as 6 weeks, if you know how to safely do it.

Why choose FOREX for obtaining wealth? Below are 10 good reasons:

1. A FOREX system is definable. You can get your hands around it (so to speak).

2. You can start learning without spending anything. Once you learn a few terms, you will be on your way. You can then add to your knowledge base along the way.

3. Unlike traditional businesses, there is very little overhead. With FOREX, there is no inventory to manage, no employees to deal with and no customers.

4. Your initial capital investment can be as little as $300.

5. You can quickly compound your money, if you know how to safely do it.

6. It doesn’t have to take a lot of your time. Some people only spend a few hours each week.

7. The FOREX market is very liquid, with trillions of dollars traded every day. On its slowest day, dollar volume on the FOREX market dwarfs that of the largest US stock exchanges, combined. You won’t have difficulty placing orders if you stick with the major currencies.

8. You can easily open an online account by selecting one from many available FOREX brokers. And you can open a demo account to practice (and learn) for free.

9. Once you get your account setup, you can trade currencies from just about anywhere. About all you need is a computer with internet access. Many accounts also provide free (and very adequate) charting software.

10. Many other people, from all walks of life, are successful at online foreign currency exchange. You can be too!

While there are other paths to monetary wealth, the FOREX path can lead you to your own personal success!

Jim McCabe

Get a free report “FOREX Freedom” to learn about a system for turning $300 into $30,000 in less than 6 months. Visit www.sensibleforex.com to get your free report.

Why Swiss Medica’s O24 Works for Pain Relief

Filed under:Universe Of Investment — posted on April 16, 2008 @ 12:38 am

Noted Herbalist Discusses the Active Mechanisms of Swiss Medica’s (OTC BB: SWME) O24 According to Mike Vertolli, who is recognized as one of Canada’s foremost herbalists, “Although it is still in its infancy, research of herbal products and essential oils has increased significantly in the last ten years.”

Vertolli was a member of Health Canada’s advisory panel on natural health products (Canada’s equivalent of the U.S. Food and Drug Administration). He believes there are constituents within the O24 Essential Oil pain relief product, which may act as powerful anti-inflammatory agents. Vertolli explained that the constituents within the O24 pain relief product have undergone rigorous clinical testing. This could help explain why O24 has become widely accepted in a short period of time.

Take for example carnosol, which is a naturally occurring phytopolyphenol found in rosemary. In a study published in the June 2002 issue of Carcinogenesis, biochemists researching anticarcinogenic properties at the College of Medicine’s Institute of Biochemistry at National Taiwan University found that carnosol may suppress nitric oxide production. That may help explain the anti-inflammatory action of the rosemary essential oil component in O24. Nitric oxide, which is released during inflammation, is a free radical that can damage DNA. Because cancer is often associated with states of chronic inflammation, O24 may be a potential alternative to anti-inflammatory medicines prescribed to cancer patients. Historically, rosemary was used as an antispasmodic, but recent research confirms its medicinal properties may be broader.

According to the American Chemical Society, which recently named the 1,8-cineole its “Molecule of the Week,” there may be a scientific reason why the O24 Essential Oil Pain Neutralizer product has out-performed other topical products in comparative testing. The cineole molecule is a major constituent of white camphor, eucalyptus and rosemary essential oils. It is also a minor component of peppermint essential oil. Cineole produces analgesic and anti-inflammatory effects by inhibiting prostraglandin, thromboxane and leukotriene synthesis. Prostaglandin synthesis is one of the culprits which causes chronic pain to last for weeks, months or years.

An entire class of anti-inflammatory drugs has come into this culture in an effort to numb chronic pain by inhibiting the synthesis of prostaglandin. Over the past few months, it has come to the general public’s attention that this method of remedying chronic pain can be deadly, i.e. the solution is worse than the problem. “Most people look upon inflammation as if it is something bad,” said Vertolli. “Like every physiological response, it has a purpose. Inflammation is an integral part of the healing process. If we apply a product that simply interferes with inflammation, it is going to interfere with healing as well. With O24 that is not an issue because of the rubefacient (local vasodilator) effects, which increase blood flow to the region (thereby providing greater access to oxygen and nutrients and facilitating the removal of waste products and toxins) and because there are constituents in these herbs that actually stimulate tissue healing.

What Vertolli may be suggesting is that a functional solution for most people suffering from pain may have been right under their noses throughout the twentieth century to this present day: essential oils. What are essential oils? They are not the same as perfume or fragrance oils, some of which are artificially created or contain artificial substances. Essential oils contain the true essence of the plant from which the oil is derived. Often, an essential oil does not have an oily feeling because it is a liquid generally distilled from a plant’s leaves, stems, flowers, bark or roots. Essential oils are highly concentrated and a little goes a long way.

Mr. Vertolli cited key components within O24’s US-patented proprietary blend of essential oils may be the reasons why this topical pain reliever has been quickly and widely accepted. In the case of the 1,8-cineole, also known as eucalyptol, recent clinical research has demonstrated the molecule’s efficacy in reducing inflammation and pain, and in promoting leukemia cell death. In southeastern Asia, cineole-rich oil is a well-known remedy for the discomfort of bruises, sprains, and pulled muscles. Many use cineole-rich oil to stimulate blood circulation near the point of application. Four components of the US-patented O24 pain relief product contain cineole: white camphor, eucalyptus, rosemary and peppermint. “Cineole is only one of many constituents of O24 that have scientifically documented anti-inflammatory action,” said Vertolli, “The action of this product is a result of the synergistic interaction of hundreds of chemical constituents. Cineole may be an important one, but it is inaccurate to suggest that it is the only constituent that is important.”

Other important constituents include camphor (white camphor, eucalyptus, rosemary), pinene (eucalyptus, rosemary, white camphor), menthol (peppermint, white camphor), limonene (lemon, sweet orange, eucalyptus, rosemary, peppermint), menthone (peppermint), carnosol (rosemary), linalool (sweet orange, rosemary, lemon), geraniol (sweet orange, lemon), anthraquinone glycosides (aloe), and dozens of others.

Not a Placebo

Components within the essential oils have long been recognized to alleviate pain. Some people might wonder whether the benefits of O24 are psychologically induced. That’s what skeptics call the ‘placebo effect.’ In other words, O24’s fast-acting and long-lasting efficacy tends to leave some consumers with the thought: “Was it O24 or did it make me feel better because I believed it would work?” That’s called the placebo effect.

Scientifically, there are molecular reasons why components within O24’s essential oils quickly bring about pain relief and then extend the relief for longer than one might expect from a topical analgesic. Most topicals contain either capsaicin, often derived from chili peppers, or salicyclates. The former create a numbing effect and has historically used as an animal deterrent - added to bird seed to prevent squirrels from eating it. A new form is being proposed as a paint additive for boats to repel barnacles. There are also formulations for keeping dogs, cats and raccoons out of garbage areas. Dozens of arthritic creams incorporate capsaicin for relief from arthritic pains. Unfortunately, it may just provide those suffering from pain a distraction as opposed to effectively reducing inflammation.

Salicyclates, on the other hand, inhibit prostaglandin and thromboxane release. As with all non-steroidal anti-inflammatory drugs, they bring about an analgesic impact on the body when topically applied. They work in the same way as aspirin does and attempt to provide a similar relief from pain, but on a topical level.

Both tend to give all topical pain relievers a bad name. With the addition of mineral oils, creams, paraffin or other additives (water, alcohol, glycerin or another binding agent), its pain-relieving properties can be diluted. This tends to explain why the scientific community denigrates topicals as an effective solution to pain. Medical doctors shy away from the general body of topical analgesics because relief is fleeting, or lead their patients to believe it is a “placebo effect.”

Yet various forms of vapor rubs, to relieve the pains of congested chests and sinuses, have sold throughout the world for decades. Such brand names, or their generics, have been doctor recommended for as long a time. Many have active ingredients that include camphor, eucalyptus oil and menthol and carry the phrase, topical analgesic, on their labels.

How do these differ from the O24 brand? Because many topical pain relievers contain some synthetic binding agent, its additives interfere with the deep penetrating and healing actions reportedly found in the essential oils. O24 is different because its patented process does not require binding agents such as alcohol or other ingredients. Because O24 is in a purer form than other topical relievers, many users have reported that the O24 brand works faster to relieve their pains and provides a longer-lasting relief from their aches and pains.

The dramatic impact O24 has had on those suffering from acute or chronic pain can be quite puzzling. Some have announced, “It’s a miracle!” Many are bewildered as to why O24 can effectively and consistently produce relief from pain, and it is often easier to question the pain relief. Understanding the mechanism of why O24 works may help dismiss the inherent, and expected, skepticism many have (until they actually try it for themselves).

Inhibiting Prostaglandin and Thromboxane Synthesis

There are specific components within the essential oils, which parallel the actions of non-steroidal anti-inflammatories. This requires a brief overview of how aspirin, aspirin-like drugs (such as the class of COX-1 inhibitors: ibuprofen, naproxen) and the COX-2 inhibitors (generically the coxibs sold as brand names: Vioxx®, Celebrex® and Bextra®) impact the body.

Those with arthritis or rheumatism may be familiar with prostaglandins. These are pain mediators in the human body, and are found in nearly all tissues and organs. Prostaglandins are hormone-like substances, a group of lipid compounds derived from fatty acids. They are produced from a precursor molecule called arachidonic acid by cyclooxygenases (COX-1 and COX-2). The arachidonic acid pathway is one of the main pain- and inflammation-producing mechanisms. Not only are the prostaglandins produced, but so are thromboxane and the leukotrienes (which cause asthma symptoms). While prostaglandins participate in the contraction and relaxation of smooth muscles, the dilation and contraction of blood vessels, the control of blood pressure and the modulation of inflammation, thromboxane (A2) is involved in the constriction of vascular and respiratory smooth muscles.

Discovered in 1971 that aspirin and other non-steroidal anti-inflammatories could inhibit the enzyme cyclooxygenase, biochemist Sir John Vane and his colleagues won the 1982 Nobel Prize in Medicine. Their research demonstrated that the potency of the anti-inflammatory medicines were proportional to how well they performed as COX-1 inhibitors. But, they also discovered that cyclooxygenase inhibition led to toxic side effects: non-steroidal anti-inflammatories cause erosive gastritis and renal toxicity.

“Wonder drugs,” such as celecoxib and rofecoxib, were designed to prevent gastric bleeding (gastric bleeding reportedly causes more than 16,000 deaths annually and has been called a “silent epidemic”). The COX-2 inhibitors are said to interfere with the prostaglandin production process. This restraining action is what made COX-2 inhibitors popular. By hindering prostaglandin synthesis, someone in chronic pain was able to alleviate his or her suffering. Unfortunately, because of the recent controversy surrounding the COX-2 class, such as Vioxx®, Celebrex® and Bextra®, many arthritis sufferers have returned to the COX-1 inhibitors (gastric bleeding that reportedly results in more than 100,000 hospitalizations annually). Common COX-1 inhibitors are probably found in your medicine cabinet: ibuprofen, naproxen and aspirin.

In Vertolli’s research into why O24 works, he found evidence suggesting that constituents within several of the essential oils inhibit prostaglandin synthesis. He wrote, “Anthraquinones, the primary active constituents in oil-based extracts of whole aloe leaf, reduce inflammation by dilating local blood vessels via inhibition of thromboxane and prostaglandin synthesis.” He also noted menthol, which is found in numerous topical pain relievers, and is a major component of peppermint essential oil. Vertolli wrote, “Menthol produces analgesic and anti-inflammatory effects by inhibition of prostaglandin, thromboxane and leukotriene synthesis. It also increases local circulation by dilating the blood cells.”

Vertolli is very enthusiastic about the rosemary essential oil in O24. Rarely is it found in a pain relief product, which is odd because of clinical research on the anti-inflammatory action of a main constituent, carnosol, discussed earlier in this article. He explained, “Rosemary reduces inflammation by protecting blood vessels, blood cells, and blood fats from oxidative stress. It also reduces inflammation and pain by inhibition of complement proteins. Rosemary essential oil improves local circulation by dilating the blood vessels (relaxing the smooth muscles that line the blood vessels) and reduces tissue swelling by reducing capillary leakage.” Blood leakage physically manifests itself as a bruise on the skin. Dr. Allan N. Fields, Swiss Medica’s medical spokesman, has recommended O24 for bruises, as a mean to reduce swelling and to accelerate the recovery period.

Finally, Vertolli returns to cineole, which he calls a “fairly strong constituent” and is found in white camphor, eucalyptus, rosemary and peppermint. Vertolli also writes, “I specifically focused on the analgesic, anti-inflammatory, relaxant and antispasmodic properties because that is what the product is being used for. I am confident you would find that O24 might reduce congestion in the nasal passages and lungs if applied to the chest. It might even help relieve tension headaches if massaged on the temples, although it is premature to recommend the use of O24 for headaches.”

James Finch contributes to StockInterview.com and other publications. His archived articles and interviews can be found at http://www.stockinterview.com You can contact James Finch by email: jfinch@stockinterview.com Additional information about Swiss Medica can be found at http://www.swissmedica.com

Additional information about Mr. Vertolli may be found at this web page: http://www.livingearthschool.ca/h-director.htm

The Covered Call / Buy-Write Strategy

Filed under:Universe Of Investment — posted on April 5, 2008 @ 11:19 am

For better or worse, most investors purchase stocks with the
intent of holding their shares for an extended period of time.

We do this mainly because the media and industry professionals
have drilled into our heads, year after year, time after time,
that it’s best to buy and hold. The recent bull market
phenomenon also fueled this mindset because the ‘buy and hold’
strategy worked extremely well - for a while.

Whether or the not the ‘buy and hold’ strategy is still the most
efficient way of investing remains a topic for discussion.
However, it is still the strategy that most investors are
comfortable with and tend to follow.

The first strategy we will discuss is a hybrid of the buy and
hold strategy, one that provides for better and more consistent
returns a large majority of the time when compared to naked
stock ownership alone.

When we buy a stock, there are three possible outcomes. As we
discussed previously, two of these scenarios are generally
negative and only one outcome is generally positive. If the
stock goes up, that is good. If the stock goes down, that is
bad. And if the stock stays still, that is also a bad outcome.

To briefly recap, not only do you have a loss in opportunity
cost (the money invested in your stagnant stock could be making
you money if somewhere else) but also, you have incurred
commission costs on both the way in and way out. So, in this
case, only one of the three scenarios provides a positive
return.

For the sake of description, we will identify the three
potential scenarios as the “up” scenario, the “down” scenario
and the “stagnant” scenario. By employing the covered call or
“buy-write” strategy, you can change the outcome of the scenario
profile so you have two positive potential results instead of
only one.

Employing the covered call or “buy-write,” we still have the
“up” scenario as a positive result, but now the “stagnant”
scenario will also produce a positive result since we collect a
premium and the third scenario, the “down” scenario will not be
as negative.

Thanks to the covered call strategy, now two of three scenarios
end in a positive result and the third has a result that is less
negative.

Let’s take a closer look at the covered call strategy and its
construction. There are two components of the covered call
strategy, the stock component and the option component.

The stock component consists of a long stock position (you own
stock). The option component consists of selling one call per
every one-hundred shares of stock owned.

Remember, one option contract is worth one hundred shares of
stock. So for example, 1000 shares of stock equals 10 call
contracts or 200 shares equals 2 call contracts.

The chart below shows more examples of the proper construction
of buy-writes.

Please take special note that the ratio of stock to calls must
be exactly 100 shares to 1 option contract.

Number of Shares Owned        Call Contracts to Sell
 100                              1
 300                              3
 1700                             17
 9200                             92
 14500                            145
 267000                           2670

The philosophy behind the covered call strategy is not
complicated. It entails using a long stock position along with a
short call option to create a positive stream of additional
income, much in the same way a person would purchase a house and
then lease it out to collect rent in order to pay for the
mortgage.

Another analogy is that of the insurance company. An insurance
company receives premiums month in and month out. Over a period
of time, this constant stream of income easily builds to a point
where it outweighs any pay out the insurance company may face,
even for catastrophic events.

The constant and reoccurring collection of option premiums works
better if done over longer periods of time (for example, one
year.) That time frame allows the odds to play into your favor.

Now let’s talk about the odds. There have been several studies
done on the topic of premium buying versus premium selling. The
goal of the studies was to determine whether it is better to buy
options or sell options.

Recent studies have found that selling the premium was the
correct trade 78% to 83% of the time. That is a very high
percentage and is worth taking advantage of when a good
opportunity presents itself.

The covered call strategy takes advantage of the fact that an
option is a depreciating asset because its extrinsic value goes
to zero at expiration. The process by which an option’s
extrinsic value dissipates is called time decay.

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