OptionsHouse was launched in 2005 and is a product of Peak6 Investments. Most investors have probably not heard of Peak6 Investments but they are quite the operation. Based out of Chicago they have traded more than 100 million options contracts since being founded and are currently one of the largest options trading firms in the whole United States.

With that said OptionsHouse provides investors two key offerings: flat rate options fees and a phenomenal trading platform.

Every discount stock broker we are aware of to date charges per contract for options trades. Most charge a flat base rate for the trade itself then a per contract price for each option, for example $9.99 + $.85 per contract. But OptionsHouse is unlike any of its peers. They have one flat rate per options trade with no extra charge per contract.

For the active options trader this is a godsend. For only $9.95 per trade you can trade as many contracts as your heart desires with no extra fees. To put this into perspective they broke down some key cost comparisons on their site which are highlighted below:

Click to Enlarge

Now it should be noted that for those investors who are only trading a handful of contracts at a time then OptionsHouse may not always be the lowest price. TradeKing for example is $4.95 per trade + $.65 per contract. So if you made a trade of say 5 contract then TradeKing would only cost $8.20 vs OptionsHouse at $9.95.

Staying focused on the active options trader though it is easy to see why OptionsHouse stands out. They also have a flat rate structure setup for regular stock trades which are only $2.95 per trade with unlimited shares (for stocks priced $2.00 or less that are not options eligible, add $0.01 per share for the entire order) and a trade platform worthy of Barrons top honors.

All the trading tools are used by Peak6 professional traders so really the platform was designed by professional options traders for options traders. With the focus being speed some of the tools include: Streaming charts & News, Risk Viewer, Probability Calculator, Put Spread Investigator, Volatility Charts, and more.

Overall OptionsHouse has a lot to offer and a great future ahead of itself. It offers active options traders a one stop shop for trading alongside giving regular investors a very competitive platform on which to trade and low prices that are hard to beat.

Visit the OptionsHouse website.

Some traders consider adjustments as something to be avoided and use them to close a position that has become a disappointment. The pessimist.

Other traders consider making an adjustment to serve two purposes. The first is to reduce immediate risk, and the second is to improve the position so that it has a better chance to earn money in the future. The optimist.

Overall adjustment plan

1. All or none. When the underlying asset reaches a price level that makes it uncomfortable to hold the position, shut down the trade. You can simply close the position and wait for a better opportunity to enter into a new trade, or you can ‘roll the position’ and enter into a new trade at the same time you close the original position.

2. Adjust in stages. Instead of adopting the all or none approach, I recommend adjusting a position several times (if necessary) to minimize the chances of incurring a large loss. For example, if you trade an iron condor with APPL options, and if you choose your iron condor so that the options you sell are 25 points OTM, you may decide to adjust when APPL moves so that one of your short strikes is only 10 points OTM. A second adjustment may be appropriate when AAPL is 5 points ATM, etc.

Alternatively you may decide to adjust when the delta of your short option reaches 30. You would adjust a second time when delta moved to 35 and yet again when delta is 40.

Adjustment alternatives

1. Close all or part of the position. The simplest adjustment

2. Buy a small number of calls and/or puts. This reduces delta, gamma and vega risk. It pays to buy options that are closer to the money than your shorts. This can be expensive.

3. Roll all or a portion to further OTM strike prices in the same month. This is not a good idea with less than two weeks before the options expire (it’s too costly).

4. Roll all or a portion to a more distant expiration month, being careful to choose a position you want to own, rather than choosing based only on the price of the options.

5. If the underlying puts are threatened with moving into the money, sell more calls spreads. If the calls are threatened, sell more put spreads. This is a very poor choice. It provides little protection and, if the market reverses direction may place your account in financial jeopardy.

Anything goes. An adjustment is any trade you believe reduces risk. But some plays are better than others. Next time we’ll discuss the all or none vs. the ‘stages’ approach.

See Also: Iron Condors Part I, Iron Condors Part II, Iron Condors Part III, Iron Condors Part IV, and Iron Condors Part V.

Mark Wolfinger is a 20 year CBOE options veteran and is the writer for the blog Options for Rookies. He also is the author of the book, The Rookie’s Guide to Options.

Further Reading, Options Trading:

• For Options Beginners, What Is An Option?
• 6 Great Option Strategies For Beginners
• 7 Reasons Investors Should Trade Options
• Options Basics Quiz
• 9 Option Terms Every Investor Should Know
• Entering an Order to Buy or Sell Options Investor Series, Part I

After some digging we found that Zecco has teamed up with GAIN Capital for their forex trading offering. Some of the Zecco forex highlights:

• up to 100:1 leverage
• trade 37 currency pairs
• access to the Zecco community
• free $50,000 practice accounts

New users can earn up to $200 cash for their accounts by making an initial deposit that falls within one of the below categories alongside making atleast one forex trade before July 31st:

Click here for more information or to open a Zecco forex account and redeem your cash.

Zecco is known for being the online stock broker that offers free stock trades to its clients. The ZeccoShare Community is also popular with currently over 150,000 members that can connect, share market insight, show their actual trades, etc.

Read more Zecco News or compare stock brokers.

TIPS ETFs

Treasury Inflation Protected Securities have become available in recent years as Exchange Traded Funds or ETFs. Currently there are three TIPS ETFs available on the US stock market today:

1. Barclays Capital TIPS Bond Fund (TIP) – TIP is an exchange traded fund seeking the performance corresponding to the inflation-protected sector of the U.S. Treasury. As of July 2009 TIP trades for just over $100 per share and has a current market cap of $8.77 Billion. According to Morningstar data the TIP ETF currently has a yield of 4.68% and a total yearly expense ratio of .20%. TIP is the most popular and widely traded ETF of its kind currently.
2. SPDR DB International Government Inflation-Protected Bond ETF (WIP) – WIP is an exchange traded seeking the performance corresponding to the DB Global Exchange US inflation linked bond capped index. It holds TIPS in developed foreign countries and even emerging markets (only about 30% of the fund). According to Morningstar data the WIP ETF currently has a yield of 3.70% and a total yearly expense ratio of .50%. There are 55 total current bond holdings and 56.1% of the total bonds held are of AAA quality.
3. SPDR Barclays Capital TIPS ETF (IPE) – IPE is an exchange traded with very similar qualities to TIP listed in the first spot above. The ETF focuses on US treasuries and has its performance correspond to the Barclay’s US Gov inflation-linked bond index. According to Morningstar data the WIP ETF currently offers a yield of 3.38% and has a total yearly expense ratio of .19%.

Because of the inflation protection, TIPS have lower yields than regular treasuries of the same maturity. Thus, investors should do research to make sure TIPS are right for their own portfolios.

Further Reading, ETFS:

• A Full list of US Treasury ETFs
• 40 Inverse ETFs For Bearish Investors
• 24 Ultra Long ETFs For Bullish Investors
• ETFs vs ETNs, the Difference
  
• Investing in Currency ETFs

The Dow Jones Industrials 8200 level is the current primary focus for many investors both institutional and retail. The strong support that has been established below the now crossing 50 and 200 day moving averages is hard to miss but will it hold up?

In last night’s edition of EPIC Insights Sean made some pretty clear remarks regarding this index that every investor should be aware of,

“First, the 50-day moving average (MA) finally moved above the 200-day MA. Typically this would be bullish and indicate that prices are prepared to move higher. Conversely, we also saw the formation of a head-andshoulders top (blue arrows). This powerful reversal pattern indicates prices will move lower. Since the bullish signal is driven more by a falling 200-day MA than any true strength, I gravitate toward the bearish camp. For weeks I have warned that the internals of the market are weak and lower prices were in the future. This led me to position the portfolio conservatively and prepare for the eventual fall. Now that a head-and-shoulders reversal has formed, a break below 8,200 will quickly send the Dow to 7,600 (red box) and raises the possibility of a retest of the March lows.”

Sean’s portfolio tracked through the newsletter has returned a staggering 24.1% return versus the S&P 500’s decline of 7.4% over the same time period! Subscribing to EPIC Insights is currently free so I suggest doing so if you haven’t already by going here and filling out the first option.

As of 11:06 AM the intraday low on the DOW is 8,205.99. Happy Trading.

As of this issue Sean’s portfolio is showing a return of 24.1% vs the S&P 500’s decline of -7.4% over the same period!

Sean’s free weekly newsletter is broken down into six main sections:

1. The Week Ahead – Identify key economic reports, earnings releases, and other events that could lead to swings in stock prices.
2. Technical Trades – Trade ideas via technical analysis.
3. Fundamental Trades - Trade ideas via fundamental analysis.
4. Option Trades – Trade ideas through options.
5. General Comments – Sean and his team share their general market thoughts.
6. Current Recommendations – Track Sean’s recommendations to see how they would perform each week in a live portfolio.

Sean designed the newsletter to be beneficial for all investors. It is a fantastic read and should become a Sunday night routine for any investor wanting to stay on top of the market.

View/Download EPIC Insights Weekly, 36th Issue in PDF Format ***Link now available***

IMPORTANT NOTICE: To receive this Newsletter’s stock picks on Sunday you must be subscribed to the free StockTradingToGo Newsletter. Otherwise we will post the direct link to the pdf on Tuesday for those not subscribed.

***CLICK TO READ PREVIOUS ISSUES***

The top 5 posts from the month of June are below:

1. 10 Great Retirement Stocks to Buy Today

2. 5 Great Ratios that Help Detect Accounting Scandals

3. Roubini, 3 Big Reasons Why This Rally Will Fail

4. Why Trade Options?

5. 5 Sentiment Indicators Every Investor Should Know

Tomorrow the market is closed which means more time to spend with family and friends. So with that said, we hope everyone has a happy and healthy 4th of July weekend!

See you on Sunday with the latest edition of EPIC Insights Weekly.

Today’s CNN Money features their top 10 which is worth a read. Our favorites from the list:

GM Partners With Segway

It became clear this spring that General Motors was going to have to get smaller to survive, but this was ridiculous. A week after President Obama gave the company a 60 day deadline to avoid bankruptcy, GM took time out from its turnaround efforts to unveil the PUMA, a two-seat vehicle being developed with Segway that looked more like a rickshaw than a car.

The vehicle, capable of going only 35 mph and traveling 35 miles between charges, got lots of attention, but did little to change popular opinion about the company that had ridden large SUVs to the cusp of failure. On June 1, GM filed for bankruptcy.

Grassley to AIG Execs: ‘Commit Suicide’

Indignation over AIG bonuses was all the rage in March, but no one took more offense than Sen. Charles Grassley (R-Iowa), who infamously told an Iowa radio station that AIG executives should consider committing hara-kiri:

“The first thing that would make me feel a little bit better towards them is if they’d follow the Japanese model and come before the American people and take that deep bow and say I’m sorry, and then either do one of two things — resign, or go commit suicide.”

A spokesperson for Grassley later said the senator was only speaking “rhetorically.”

Geithner Gives Few Details, Tanks the Market

In February, President Obama used his first White House press conference to alert the public to a momentous event. “Tomorrow, my Treasury Secretary, Tim Geithner, will be announcing some very clear and specific plans for how we are going to start loosening up credit once again,” he said.

But when Geithner appeared at Treasury the next day, on Feb. 10, he offered few plans of any sort, let alone clear and specific ones, which helps to explain the stock market’s 5% plunge that day. Since then Geithner has loosened up, with the help of a media trainer — and the market has bounced back. Coincidence?

For juice lovers when reading the bit on Tropicana’s redesign blunder just simply remind yourself that nothing is worse than Coke’s launching of the “New Coke”.

Read the rest at today’s Yahoo Finance.

Related Posts:

• 7 Great Questions to Ask When Choosing a Financial Adviser
• 10 Great Retirement Stocks to Buy Today
• 3 Ways to Fix Your Retirement Account
• 10 Best Iphone Applications for Finance and Investing
• 10 Best Stock Performers Since 2000
• 12 Great IRA Tips for Success

Source:
Dumbest Moments in Business 2009…Midyear Edition
Jon Birger, CNNMoney.com
Yahoo Finance, Tuesday, June 30, 2009