There are many people looking for information on good Forex trading e-books online. The variety of what can be found is amazing. There are plenty of free e-books that range from complete crap to genuine decent starting information, and then there are the in depth e-books that most often come with online memberships or classes that actually get into the nitty-gritty of how to make money trading the Forex market.
There are a lot of different e-books on the Forex out across the web, as makes sense, since the Forex is a market that can only be traded online. It makes sense, then, that a lot of the best information on the Forex could also be found online. While there are a lot of e-books floating around, never expect more than learning the basics of how Forex works from the free e-books. No one is going to give away their best Forex trading system for $0.
The other thing to watch out for with Forex e-books is bad information. The Forex market isnt as closely regulated as stocks, bonds, or commodities, so there really isnt a governing branch watching out for con artists or snake oil salesmen. The good news is that once you have even a basic Forex education, you will be able to figure out very quickly who is legit and who isnt. There are several people out there who make money off selling Forex trading systems as opposed to trading the Forex.
If the person cant make money on the Forex trading, there is absolutely no reason to buy a Forex trading e-book from them. A lot of the free Forex e-books that dont ask for you to sign up for a membership or a well established companys mailing list are going to be fluff. That doesnt mean that every e-book that comes with a sign up isnt, but look for reputable companies that have a long history of trading the Forex successfully, and you are far more likely to get information of substance that will be useful.Aside from that, make sure youre getting an e-book that fits what youre looking for, whether it is a basic overview of the Forex, or the offer of a free trading system in order for a company to prove their strategies, and enjoy your new information.
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From Jason Fielder: Founder, ForexImpact.com
About the Author:
Im Drew Franklin Gates, and I went through a personal transformation that changed my life forever for the better.
After working as a highly paid slave for seven long years (all the while making my bosses rich), I quit my job and decided to start my own company. This was back in 2001.
So for three years I tried everything you can imagine to make a buck. I built websites, I sold investment advice, I hustled at the multilevel marketing game, and at one point I was even buying and selling burned out crack houses in the inner city.
After three years of little to no progress, I finally realized what the problem was: ME. I thought I knew it all. So I started to invest in education. Im not talking about traditional so-called
Although covered calls seem to have low risk, it is possible to get into trouble if you don't pay attention to the risks that do exist. You may do quite well for several months and then find yourself having a really bad month because you ignored or forgot to research some of the risks.
The first risk is an unexpected tax event. Because U.S. style options can be exercised at any time prior to expiration, the seller of the option (i.e. the covered call writer) has a risk that the buyer will exercise the option prior to expiration. Normally it doesn't make economic sense for the buyer to do this if there is still time premium remaining in the option, because the buyer forfeits the time premium when he exercises. So if he wants to close out his option that still has time premium then he would be better off just selling the option instead of exercising it.
Hard to believe but there are some uninformed actors involved in the stock market. They do crazy things like take early exercise on options that have time premium (whereas it would make more financial sense for them to just sell the option so they didn't have to forfeit the time premium). Now, if this happens in an IRA account it doesn't matter (since it's a non-taxable account). But in a taxable account it can cause tax problems. Usually you only have to really look out for this as an ex-dividend date gets near, and only then in options that have just a penny or two of time premium.
Next risk is the reduced upside potential above the strike price. The covered call writer can set the strike price to whatever value he likes, but one thing is true -- whatever value he sets it to is the most he will receive for his stock between now and expiration. If there is a happy surprise of any kind (M&A takeover, increased guidance, earnings beat, competitor fails, etc) and the stock rises above the strike price then the covered call writer will not make as much as he could have made if he hadn't sold the call.
Downside protection is comforting, but should not be leaned on as a savior to prevent all losses. The option premium you receive will cushion the first part of any loss but if the stock drops significantly then you will probably still have a loss (less than a buy and hold investor, for sure, but it's still a loss). Often cited as the tradeoff for putting a cap on your upside potential, it is definitely a good feature of the strategy but just be aware that you can still lose money with covered calls.
Lastly is the risk of chasing yield. It's tempting to use a covered call scanner to identify the highest yielding covered calls and then just blindly write those options. Seldom a good idea. A covered call scanner is just a starting point for additional research. It will help you identify juicy premiums as an idea list to start from but then the you need to thoroughly research each one before investing. Covered calls have risks but they are one of the most conservative investments an investor can make, if used correctly.
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