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The Impact of Recent Merger Activity on Options Trading

by George RuhanaMarch 4, 2010

Through the first two months of 2010, it appears the merger and acquisition party of the late 90s and early 2000 could be raring up once again. As Warren Buffett pointed out in his annual letter to shareholders, bankers don’t get paid for suggesting that companies not do deals, they get paid to encourage companies [...]

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Trading Ideas in JPMorgan Chase (JPM), Cramer’s Big Bank Pick

by Steve ClaussenMarch 3, 2010

Jim Cramer praised JPMorgan Chase (JPM) Chief Executive Jamie Dimon, calling him “The best banker in America,” during the February 24th edition of CNBC’s “Mad Money.” Cramer was also positive on the bank’s balance sheet as well as its overall growth and dividend potential. In short, Cramer is bullish on [...]

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Options Trades in Devon Energy (DVN), Cramer’s Pick in Natural Gas

by Steve ClaussenMarch 3, 2010

Jim Cramer said in a February 19 edition of CNBC’s Mad Money he thinks Devon Energy (DVN) has become the best way to play natural gas. The company’s shares were trading at $71 at the time of Cramer’s insight.
When Cramer sends out comments like this, investors who use options can try many different strategies, as [...]

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Bulls vs. Bears: Research in Motion, Limited (RIMM)

by Steve ClaussenMarch 1, 2010

In an episode of CNBC’s Mad Money last week, Jim Cramer expressed caution toward Research in Motion Limited (NASDAQ: RIMM), saying he doesn’t expect a comeback in the shares anytime soon.  At the time he discussed the shares, they were trading at $71.  When a market pundit sends out comments like this, investors who use [...]

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VIX Settlement: Carpet Bombs in the SPX

by Steve ClaussenFebruary 18, 2010

What Does a Carpet Bomb in SPX and a Lower Trending VIX Mean to You?
The VIX options for February expiration settled yesterday morning at 22.50 based on the calculation of the implied volatility in the S&P 500 options on which this index is based.
This typically causes what is known as the carpet bomb in SPX [...]

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Berkshire Hathaway B (BRK.B) Splits its Way to the S&P500

by Steve ClaussenFebruary 12, 2010

Berkshire Hathaway B (BRK.B) shares split 50 for one January 21st. In the past, Warren Buffett said stock splits are for idiots, since the economic value of the enterprise does not change. The action of splitting shares has often resulted in the stock price gaining due to the price of the shares [...]

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Heavy Activity in American International Group (AIG): Sign of a Classic Short Squeeze?

by Steve ClaussenFebruary 11, 2010

Yesterday, the OptionsHouse Hotlist picked up huge action in the American International Group (AIG $26.92 +3.78). This stock rocketed more than 16% after the company stated it is in talks to sell assets; possibly to pay back a portion of its debt to the government. This initially sent shares only slightly higher. However, the buying [...]

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Successful Traders Must Have Discipline

by Steve ClaussenFebruary 5, 2010

Most investors have what is known as positive beta to the overall market. 
Beta is the term in finance that describes the relationship between a portfolio’s return and the market as a whole. This means even the best individual stock picker in the world could lose money if the market has a day like yesterday and today. [...]

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Air Products (APD) May Go Hostile in Attempt to Acquire Airgas (ARG)

by Steve ClaussenFebruary 5, 2010

Airgas Inc (ARG) is topping the Optionshouse hotlist this morning after Air Products & Chemicals (APD) said it may take a 5.1 billion dollar cash offer ($60/share) for Airgas Inc. to shareholders. 
The board of directors of Airgas has rejected two prior attempts by APD for a friendly merger that would create the largest American industrial [...]

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Four Key Events Could Make This an Exciting Week for the Market

by Steve ClaussenJanuary 25, 2010

This week holds four potentially exciting catalysts; each with the potential to dominate business media headlines.  Is it any wonder that the VIX has spiked back above 25%?

Wednesday night President Obama will deliver his State of the Union address
Will Health Care remain in focus following the Massachusetts run-off election results?
Will new Bank regulations and taxes [...]

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