We recognize that people everywhere have questions about how to save and invest. Our raison d’être is to help people do just that. The economy, markets, and people’s personal circumstances change over time. It is important for people to be aware of these changes and modify their investment posture accordingly.
We believe people should balance in their lives and this includes how they go about preparing for their financial future. To create that balance we believe investors should allocate their investments between both active and passive investment strategy.
While we discuss Strategic Asset Allocation as the core of passive investing from time-to-time, the primary focus of The Options Edge News and Investment Commentary Services will focus on active management. We think about active management in multiple parts. They are;
- Strategic Asset Allocation – The mix of stocks, bonds and real estate, commodities, currencies one should hold in their portfolios over the long term, derived from the investor’s current financial circumstances, future obligations and risk tolerances.
- Tactical Asset Allocation – The mix of stocks, bonds and real estate, commodities, currencies one should hold in the context of current market conditions.
- Security Selection – The individual stocks, ETFs, REITs, MLPs, mutual funds, etc. the investor should include in their portfolio that is consistent with the investor’s asset allocation discipline that is designed to capitalize on the unique opportunities those securities represent.
- Trade Structuring – The use of individual securities and associated options designed to capitalize on one’s investment thesis, while structure the risk profile ahead of time.
Options are one of the most important financial innovations of the past 100 years. Readers will be exposed to the use of options as a means of pre-packaging trading risk, enhancing yield and using leverage in a way the improves right adjusted returns.
Options are complex financial instruments. This complexity can often frustrate investors when they use them for the first time. To make the use of options logical and intuitive, we focus our effort on education. The first step in that process is the publication of our best selling book, “The Options Edge.” We wrote this book with the self-directed investor and the professional investor who use options as part of a larger investment strategy in mind. Those who study the content of our book will learn the fundamentals as they build a foundation of understanding.
In our News and Investment Commentary Service, we publish a number of articles every week that demonstrate how investors might match a certain options strategy to a particular investment situation.
The Options Edge News and Investment Commentary is NOT A TRADING SERVICE, but we do provide trade ideas for you to consider and explore on your own or with your financial advisor. It is important to remember that these trades are not intended to create a recommended portfolio. We recognize that our subscribers may pick and choose to implement a trade idea here and there, which fits their larger investment strategy, risk tolerance, and analytical expertise.
At the same time, we want our readers to be able to evaluate our process. To that end, we review trading ideas from time-to-time and summarize the results of all our recommendations. We want to be transparent about both our winners and losers.
If you are looking for a trading idea generating service that never makes a mistake, you have come to the wrong place. Our investment process is not perfect. We cannot see into the future with perfect clarity. We believe we have a process that puts the probability of success on our side. By sticking with our discipline, we believe we will be successful over time. When events manifest that is contrary to our expectation, we do our best to recognize the world has changed and cut losses as quickly as we can. Knowing that market prices can move swiftly and brutally, we generally prefer to use options strategies that pre-package our risk going in. But any investment or trading decision is the responsibility of our readers. In the final analysis, we want our readers to take ownership of their decisions and become more skilled traders investors by reading our commentary, white papers and trade ideas we present in real time.
As a final thought, we want to have a dialog with our followers. We look forward to your feedback and questions concerning the very difficult task of investment management.
Michael Khouw is an Executive Editor to TheOptionsEdge.Com and a veteran of the financial services industry that began in the 1990s as a member and floor trader in the open-outcry pits of the Philadelphia Stock Exchange, the American Stock Exchange, and the New York Mercantile Exchange. Mike is a panel member of CNBC’s weekly TV show, “Options Action.” See Mike’s bio for more.
Mark W. Guthner, CFA is an Executive Editor to TheOptionsEdge.Com and a veteran of the financial services industry. His skills and experience stretch across multiple disciplines including trading, portfolio and risk management, securities analysis and valuation, investment banking and financial technology as well. He also donates his time and talents as a consultant to the CFA Institute. He is also a Professor of Professional Financial Practice at Rutgers Business School, the State University of New Jersey. See Mark’s bio for more.
Thank you for taking a moment to learn more about TheOptionsEdge.Com. Mike, Mark and the entire team at The Options Edge look forward to providing you with uncommon insights you may not find anywhere else. If you have any questions or comments, please feel free to contact us at your convenience.