General

Option Equivalence

A few days ago I had an inquiry from a person trading options in a restricted account (e.g. an IRA that did not allow marginable trades or short options positions): “I have an IRA in which I trade options.  I wanted to sell a put, but my broker won’t allow the sale of puts in…

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How a Fund is Developed

Many individuals are curious as to the testing process for a new fund.  With the plethora of funds continually being developed, having some insight into this process can be helpful for investors.  At the very least, it can provide a series of questions which should be asked in conducting due diligence on fund managers. This…

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How to Think about Financial Models

Checking the weather? Guess what—you’re using a model. While models can be useful for gaining insights that can help us make good decisions, they are inherently incomplete simplifications of reality. In investing, factor models have been a frequent topic of discussion. Often marketed as smart beta strategies, these products are based on underlying models with…

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The Importance of Time Horizons in Investing

The following set of charts are great visual aids for showing the benefits of long-term investing in the stock market. The charts can help investors plan and set proper expectations. Two terms to understand the charts are below. DFA Domestic Balanced Strategy Index: This is a diversified blend of Dimensional US equity indices. The index…

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Getting to the Point of a Point

A quick online search for “Dow rallies 500 points” yields a cascade of news stories with similar titles, as does a similar search for “Dow drops 500 points.” These types of headlines may make little sense to some investors, given that a “point” for the Dow and what it means to an individual’s portfolio may…

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Equity Index Put Writing for the Long Run

Equity Index Put Writing For The Long Run One of my all-time favorite investing books is Jeremy Siegel’s Stocks For The Long Run, which is currently in its 5th edition. It’s a true classic that I refer to often.  Professor Siegel lays out the compelling case for equities over extended time horizons such as 20 or…

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Why Should You Diversity?

When international stock returns lag, investors may feel tempted to double down on their home market. Historical data suggests the long-term benefits of diversifying globally. Why Should You Diversify? As 2019 approaches, and with US stocks outperforming non-US stocks in recent years, some investors have again turned their attention towards the role that global diversification…

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ITIN Mortage Investing

Background Currently there are close to twenty million undocumented immigrants in the U.S., according to the U.S. Government Immigration Service.  The average time that it takes an undocumented worker to become a U.S. citizen is seven years.  During this process the undocumented workers must rent a home, rent an apartment or stay with a family…

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Key Questions for Long-Term Investors

Asking the right questions and following a few key principles can improve your odds of long-term investment success. Whether you’ve been investing for decades or are just getting started, at some point on your investment journey you’ll likely ask yourself some of the questions below. Trying to answer these questions may be intimidating, but know…

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Trade Journals & Successful Option Trading

I’ve now been trading options for over a decade and been associated with Steady Options for seven years – hard to believe. Over that period, I’ve learned quite a bit about option trading; how to improve, what not to do, and generally how the option markets work. I’m still learning. Seeing how large blocks of options…

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