Recent content by Randy Frederick

Key Points Trading always involves some level of risk, but “risk” can be defined in many different ways. Is it the probability of profit compared to the probability of loss? Or is it the amount you could earn compared to the amount you could lose? Plus, how do you quantify risk? Is it the...

Many traders know that options strategies provide an abundance of choices. But is it possible to construct an options trading strategy that will hedge against bad news—whether expected or unexpected? The answer is yes and no. Let's explore. Known events or unknown events In the markets as in...

Many investors find volatile – fast moving markets to be very unsettling, but low volatility – sideways markets can be equally frustrating because while risk could be lower, the potential for profit is probably reduced as well because option premiums are lower during these periods. Here I’ll...