The MVP Stock Methodology invests in stocks that are in the Chuck Hughes Trend Line Strategy 'buy ' mode with trend verification of a new 52-Week High or price level confirmation. Historical and tangible profit results demonstrate this fusion of strategies produces a strong investing force that identifies stocks with the greatest profitability. I also use this combination of techniques to invest in call options on MVP Trend Line Stocks. The MVP Stock Strategy has clearly defined purchase and sell rules that can be used to buy and sell call options on MVP Trend Line Stocks.
MVP Option Strategy Rules
1. Get a call option on a stock if its 40-Day Weighted Trend Line (WTL) is above the 80-Day WTL
2. Sell any option if its underlying stock's 40-Day WTL crosses below the 80-Day WTL or on option expiration day whichever comes first
When I compare investing using the MVP Stock Strategy to other standard stock secrets, MVP walks away as the clear winner! But the MVP Option Strategy can be rather more lucrative. I know about now you're thinking about, "Why risk investing in options when I will receive a good return investing in stocks? Why go out on a limb, why push it? Why options?" This is why: Investing using the MVP Trend Line Option Methodology can provide amazing returns. Yes, this is how the big money can be made. This is how the 'late out of the gate ' investor can make up for lost time. While investing utilising the MVP Trend Line Option Plan can offer a much greater return than investing utilizing the MVP Trend Line Stock Strategy, option investing also carries bigger risk so it's vital to grasp the risks involved with option investing.
"Don't be scared to go out on a limb. That is where the fruit is."
- H. Jackson Browne
The greater return potential linked with options is due to the leverage that options provide. Let's take a look at some precise option examples so that you can understand the critical concept of leverage and how leverage can provide a heavy rate of return. The option quote table that follows contains exact call option costs (courtesy of Yahoo Finance) for Hewlett Packard (HPQ). Buying call options is a bullish system as the value of a call option will increase as the price of the basic stock increases. Hewlett Packard stock is presently trading at 32.78. Let's focus on the March 35-Strike call option (circled).
10% Share Price Increase = 950% Option Return
Purchasing the 35-Strike call option gives us the inherent right to buy 100 shares of HPQ at 35.00. If we were to buy the 35-Strike call option we'd expect to pay the 'ask ' price of .10 cents or $10 per option (.10 x 100 shares = $10). Let's assume HPQ stock increases 10% in price from the prevailing cost of 32.78 to 36.05 (not a peculiar assumption as HPQ stock has increased more than 60% during the last year). With a share price of 36.05 the 35-Strike call option would be worth 1.05 points or $105 (stock price of 36.05 minus 35-Strike price = 1.05 option value). When you purchase options you can sell them anytime before option expiration. So the option we purchased for .10 points may be sold for 1.05 points. Selling the 35-Strike call at 1.05 would produce a 950% return (1.05 sale price minus .10 cost = .95 profit divided by .10 cost = 950% return).
The Power of Leverage
The table below compares the profit potential of purchasing Hewlett Packard stock at today's cost of 32.78 vs the HPQ March 35-strike call option at .10 points. If HPQ stock increases to 38.00 stock stockholders realize a 15.9% return but option stockholders realize a 2900% return. If HPQ stock increases to 40 stock backers realize a 22% return but option investors realize a 4900% return.
Cautious Speculation
I want to make one vital difference between the leveraged investments we use with the MVP Option Techniques versus 'high risk ' leveraged investments. All the Chuck Hughes MVP Option Secrets use 'limited risk ' leverage. This means that the most you can lose is your original investment. Regardless of adverse. Market moves you can't lose more than your original investment. You will not receive a 'margin call ' from your broker or get asked to add funds to your account to avoid the forced liquidation of your positions.
MVP Option Strategy Rules
1. Get a call option on a stock if its 40-Day Weighted Trend Line (WTL) is above the 80-Day WTL
2. Sell any option if its underlying stock's 40-Day WTL crosses below the 80-Day WTL or on option expiration day whichever comes first
When I compare investing using the MVP Stock Strategy to other standard stock secrets, MVP walks away as the clear winner! But the MVP Option Strategy can be rather more lucrative. I know about now you're thinking about, "Why risk investing in options when I will receive a good return investing in stocks? Why go out on a limb, why push it? Why options?" This is why: Investing using the MVP Trend Line Option Methodology can provide amazing returns. Yes, this is how the big money can be made. This is how the 'late out of the gate ' investor can make up for lost time. While investing utilising the MVP Trend Line Option Plan can offer a much greater return than investing utilizing the MVP Trend Line Stock Strategy, option investing also carries bigger risk so it's vital to grasp the risks involved with option investing.
"Don't be scared to go out on a limb. That is where the fruit is."
- H. Jackson Browne
The greater return potential linked with options is due to the leverage that options provide. Let's take a look at some precise option examples so that you can understand the critical concept of leverage and how leverage can provide a heavy rate of return. The option quote table that follows contains exact call option costs (courtesy of Yahoo Finance) for Hewlett Packard (HPQ). Buying call options is a bullish system as the value of a call option will increase as the price of the basic stock increases. Hewlett Packard stock is presently trading at 32.78. Let's focus on the March 35-Strike call option (circled).
10% Share Price Increase = 950% Option Return
Purchasing the 35-Strike call option gives us the inherent right to buy 100 shares of HPQ at 35.00. If we were to buy the 35-Strike call option we'd expect to pay the 'ask ' price of .10 cents or $10 per option (.10 x 100 shares = $10). Let's assume HPQ stock increases 10% in price from the prevailing cost of 32.78 to 36.05 (not a peculiar assumption as HPQ stock has increased more than 60% during the last year). With a share price of 36.05 the 35-Strike call option would be worth 1.05 points or $105 (stock price of 36.05 minus 35-Strike price = 1.05 option value). When you purchase options you can sell them anytime before option expiration. So the option we purchased for .10 points may be sold for 1.05 points. Selling the 35-Strike call at 1.05 would produce a 950% return (1.05 sale price minus .10 cost = .95 profit divided by .10 cost = 950% return).
The Power of Leverage
The table below compares the profit potential of purchasing Hewlett Packard stock at today's cost of 32.78 vs the HPQ March 35-strike call option at .10 points. If HPQ stock increases to 38.00 stock stockholders realize a 15.9% return but option stockholders realize a 2900% return. If HPQ stock increases to 40 stock backers realize a 22% return but option investors realize a 4900% return.
Cautious Speculation
I want to make one vital difference between the leveraged investments we use with the MVP Option Techniques versus 'high risk ' leveraged investments. All the Chuck Hughes MVP Option Secrets use 'limited risk ' leverage. This means that the most you can lose is your original investment. Regardless of adverse. Market moves you can't lose more than your original investment. You will not receive a 'margin call ' from your broker or get asked to add funds to your account to avoid the forced liquidation of your positions.
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