March 30th, 2011
It is imperative that we
open up the right kind of trading account to start or be in danger of
having to maintain a 25, 000 dollar balance in some cases ... this is
especially crucial in the U.S.
I just wanted to write you a quick note: I'm not sure if this
is anything particular that will impact any of your clients,
but just in case...
NYSE & FINRA both stipulate that for brokerage accounts
with a balance of less than $25,000 may not make make more
than 3 trades per rolling 5 business/market days.
I hope this helps; it might be a way for you to assist those
just coming into stock options.
Happy trading friend,
All of my clients are supposed to be trading LONG CALLS and LONG PUTS
only ... all trades are paid for with cash up front ... therefore the
25k rule should not apply since it is impossible to create a
"Margin Call" on any trade .....
We tell the broker this up front when we open the account ... that all
the trades are PAID and LONG ...
Here is an article on the rules .... it verifies that it applies to
margin accounts and people that borrow ...
so if you want to get out of this rule you will have to stop trading
those "Exotic Ideas" ... examples being ... condors ....
butterflies .... etc ... etc ... where there is a possibility of
getting a "Margin Call" on the institutions money ...
Please never borrow money from the institution ... or put
yourself in a position where you will require a "Line of
Credit" from them to do so ....or else you will be subjected to
terms stipulated by them to maintain that "Line of Credit"
This can be very dangerous if the market happens to move against
you .... in some types of trades it is possible to put yourself into a
position of "Unlimited Liability" ...
That is why we do not use their money to trade ....or their
"Lines of Credit" to trade ...
Please keep it simple ..... so that no sleep is lost
give this a read ok ...
Happy Trading Dude !!
January 8th, 2011 -
I received a phone call
today from Colette asking about the Iraqi Dinar play that is
apparently being promoted quite heavily in the U.S. .... so here is my
personal opinion ... please do not take it as financial advice ... it
is my personal opinion on this play .... I have now had a few people
ask me about this ... so here is my stand as of today ..
Hello Colette ...
It was great talking to you on the phone again .....
I did some more research on your Dinar play ... since a few people
have asked me
about this ....
The first question I ask with any investment I make is ... "Can I
sell my investment just as easy as I purchased it" ...
Now even on the stock market we have a thing called the OTCBB ....
Over The Counter Bulletin Board ... this is where
people trade penny stocks ...
I do not trade here because even this exchange does not meet my
standard of liquidity & volume ...
Now when I look at this Dinar play you are getting involved in .... I
ask myself can I go to a Bank
and cash my Dinar in ...
I do believe the answer is "NO" .....
That is one reason I must say this is an extremely SPECULATIVE play
... it is a pure GAMBLE ...
Please proceed with caution .... in my opinion you should only
allocate 1/2 to 1 % of your total portfolio to this ...
at the most ... if you insist on doing this play ....
Like I said I am personally conservative ...
If I was going to do this trade ...I would look at this play on the
"Stock Market" through a publicly traded ... ETF
or the other option would be to educate yourself in FOREX ... if
you want to trade currency ... then learn how to do it right ....
learning how to trade currencies in my opinion is a valid way to trade
... I just do not personally enjoy that arena because it is not as
diverse as the Stock Market....so I do not do it ...
What can I say ... I Love the Stock Market ! ....Hope that helps you