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Greg Group  

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  • For Dividend Income Investors: A More Tactical Approach To Covered Calls [View article]
    So you are setting a stop loss at $85. So MCD at $95 falls to $85, then you LOSE $10,000 since you could have sold MCD at $95. This does not lower your cost, it increases your lost by 10.5%. OK, so you keep the $270 from selling the call so your LOST is only $9,730 plus all future dividends with a cost to yield of 5.6%. So when did taking a LOST on a LONG position lower your cost basis? You are correct, this is not a perpetual income trade as it is a one-time LOSS of $9,730.

    So you are risking losing $9,730 with the stop lose to make $270 by selling a call at a 95 strike. I do not think any sophisticated investor will take those odds in such a volatile market event as November has been. The better trade would be to BUY a 85 strike MCD PUT for the downside protection instead of setting a stop order at 85. The 85 PUT will increase in value as MCD price falls.

    Thanks for sharing.
    Dec 2, 2011. 11:19 AM | 1 Like Like |Link to Comment
  • 2 Closed-End Funds With High Yield Distributions [View article]
    Thanks for your comment. CEFs trade at their market prices. When you place your order it will cost $10 per share in the example you showed. The NAV is the actual value of the assets of the CEF. In your example, the CEF trading at $10 is higher than the NAV of $9 so it is trading at a premium to NAV. I like to track the dividend yield based on the market price because it is my actual cost (market price) of the trade. This is important to track as you reinvest distributions as the market price will change each day like a stock.
    Nov 24, 2011. 06:52 PM | Likes Like |Link to Comment
  • 2 High Yield Investments With Growth Potential [View article]
    Thanks for your comments. TCLP has a debt to equity ratio of 0.56 with only $750 million in debt compared to D/E ratio of 133.29 for EPD which has $15.4 billion in debt.. TCLP is a better pick in my opinion.
    Nov 20, 2011. 11:51 AM | 2 Likes Like |Link to Comment
  • 2 Closed-End Funds With High Yield Distributions [View article]
    You are correct that these CEFs are trading at a premium to NAV. This is due to two reasons: (1) they have exceptional total returns in the last year; (2) the demand for high yield has push the CEFs prices into the premium level. Both of these CEFs are highly rated due to the performance of their management teams and their great results. Be careful, some CEFs are trading at a discount for poor results and other reasons. I suggest that you do not buy a CEF on the high yield alone as CEFs should be analyzed like a stock. The high yield should provide downside protection if you stay in these CEFs over a period of time. The other option is to dollar-cost average into these CEFs or wait for a pullback in this volatile market. Thanks
    Nov 19, 2011. 06:22 PM | 1 Like Like |Link to Comment
  • How To Play IBM On The Cheap [View article]
    Thanks for your question. The 12.92% return is the estimated return at the 64th day of the trade (expiration) based on the current stock price. This takes into account the time value portion of the options. The 2013 LEAP will lose some time value over the 64 day period. However, the LEAP loses time value at a much slower rate than the sold Jan 2012 call. This is how the trade makes a profit over the 64 day period even if IBM doesn't move in price. The 177 and 189 price points are where you get the most profit in the nest 64 days.

    Keep in mind, at expiration of the sold call, you can sell a new call at a future date, hold the LEAP on IBM for future gains, or exit the trade by selling the 2013 LEAP.
    Nov 19, 2011. 06:12 PM | Likes Like |Link to Comment
  • Using Covered Calls to Achieve a 10% Yield on Apple [View article]
    Apple is not the right stock for a covered call. Apple has a 39% 52-week price performance so why do you want to limit your upside to the call strike price for a 10% yield? If you want to do covered calls then you should sellect a lower growth stock with a dividend to increase your return.
    Sep 25, 2011. 02:18 PM | Likes Like |Link to Comment
  • How to Generate Income on Positions [View article]
    I do not agree with the covered call screener as many investors have lost a significany amount of capital by writing calls on the wrong stocks. save your money and learn how to select the right stocks for writing calls. Review these articles to protect your capital:
    Sep 25, 2011. 02:09 PM | Likes Like |Link to Comment
  • Covered Call Opportunities for February 2010 [View article]
    You do not need a sceener during market hours as you are not day trading covered calls!!! You find an opportunity in a stock then go for selling a call for time decay. Since when did a screener during daily markets help erode time decay?
    Sep 25, 2011. 02:03 PM | Likes Like |Link to Comment
  • 5 More Reasons to Avoid [View article]
    Apparently you are a Google fan. BIDU is listed as an outperform by Thomson, Smart Consensus and Second Opinion. BIDU is up 27% in the last 3 months compared to -7.7% for the SP 500. BIDU is a momentum play that cannot be measured by PE. I will take a 128% return in a year - anytime I can get it,

    Good investing.
    Jun 9, 2010. 09:37 AM | 2 Likes Like |Link to Comment
  • Glass-Steagall: Be Careful What You Wish [View article]
    I believe the removal of Glass-Steagle lead to the elevated risk taking as traditional banks started chasing profits like traditional Wall Street firms. The proof is in the bank cap rates as post-GS and bubble time they were at a low of 5-8%. Following TARP, they were increased to 20% with the TARP money sitting on their balance sheet.

    The role of banks within the economy was changed post-GS as they levered their investments to compete for a higher return. This led to the risky CMOs as banks changed how they selected appropriate borrowers such as FICO scores instead of ability to make payments, etc.

    I am not a Volcker supporter. I can tell you that Larry Summers should have to answer for what he has done to the financial markets through his touting of these regulatory changes. No single person has been more instrumental in damaging the U.S. Economy.
    Jan 22, 2010. 12:57 PM | 2 Likes Like |Link to Comment
  • Alpine Global Premier: From a Double Digit Discount to a Premium? [View article]
    I think this ETF trades at a discount because its top holding is Annaly which will get a big hit if interest rates increase in 2010. I recently sold Annaly and Hatterus becuase of the risk. This will be a good ETF to place on your watch list as the discount becomes bigger it will be a buy.
    Jan 7, 2010. 09:42 AM | Likes Like |Link to Comment
  • 'Trend Trading for a Living' Doesn't Disappoint [View article]
    I am interested in knowing if any readers have used this trading system and what results they achieved?

    Thanks for sharing
    Jan 5, 2010. 10:12 AM | 2 Likes Like |Link to Comment
  • Basic, 5 ETF Portfolio with Which to Start the Decade [View article]
    This is good for an easy, basic portfolio. I would suggest including active management with trend following through a 100-day or 200-day average. There are times when you don't want to be in the market (4th quarter 2008).

    Nice work!
    Jan 5, 2010. 10:10 AM | 1 Like Like |Link to Comment
  • Have Your Gold ... and Dividends, Too [View article]
    <IMG class=authors_reply src=""> A great discussion here. Obviously, GGN is not intended to be a substitute for the physical metal. GGN offers the income investor a chance to generate income while being exposed to precious metal stocks that move with inflation. A couple of points to consider:

    1) There has not been any return of capital in 2009 - according to CEFConnect;
    2) This fund owns gold and natural resource stocks so it will still have systemic risk;
    3) This fund sells calls against its position to generate income;
    4) Holding physical gold does not pay your monthly mortgage or buy groceries so you will be subjected to the price fluctuation of gold when you sell your hard assets (your gains are still paper gains until you sell but dividends from GGN are delivered today to be reinvested).
    5) What is your exit strategy if you hold physical gold? How long will it take to exit your position and how efficient is the pricing? Equities have systemic risk like we saw in Sept 2008, but you can exit in seconds if you have a great exit strategy (trailing stops, moving averages, etc.);
    6) Think about what may happen if the herd or foreign govts decide to start selling the physical metal. Prices can drop rapidly with a flood of supply hitting the market all at once (early 80s) and may stay low for decades. For example, the holders of physical gold coins will be subject to the dealers who buyback your gold. Gold, unlike silver, does not have much industrial usage. If you want to hedge inflation, you can buy TIPS. If you think paper currencies will become insolvent, then there really is no good alternative (unless you live off the land in some secluded spot on this planet where robbers/murderers can't take it away from you).

    Thanks for reading and commenting on this article.

    Greg Group -
    Jan 1, 2010. 11:49 PM | 4 Likes Like |Link to Comment
  • The Best Dividends for 2010 [View article]
    I wrote this article following my research on these stocks. I started with a list of individual stocks with good yields but went further by identifying which stocks were strong buys based on a number of criteria.

    I did not want to be seen as pumping up a stock that I already owned. The analyst on the street do not own the stocks they follow for this reason. I presently own several ETFs that pay monthly dividends. This will be the focus of a future article. I have several trading accounts as I generate income from option selling.

    Thanks for reading and commenting on this article. I am open to any questions you may have in the future. What topics would you suggest for future articles? I love to research stocks and write about investing opportunities.
    Dec 29, 2009. 09:25 PM | 4 Likes Like |Link to Comment