Q & A  2011

 

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.

Brian,

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,
Josh

Josh

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 ...

http://www.finra.org/investors/smartinvesting/advancedinvesting/daytrading/p005906

Happy Trading Dude !!

B

 

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 ...

Warmly,
Brian

 

Brian

 

 

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