SPLK - Splunk, Inc. – Options on software and data analysis company, Splunk, Inc., are far more active than usual this morning, with volume topping 4,600 contracts versus the stock’s average daily options volume of 670 contracts, as of 11:20 a.m. ET. Shares in the name are up better than 6% on the day to stand at $31.63, the highest level since October 2012. Traders positioning for shares in the name to extend gains in the near term snapped up January and February expiry call options. Upside calls with one full trading week remaining to expiration looked to the Jan. $30 and $35 strikes, purchasing around 500 and 220 contracts at those striking prices, at average premiums of $0.92 and $0.11 apiece, respectively. Bullish activity spread to the Feb. $35 strike where around 450 calls were purchased for an average premium of $0.41 each, preparing buyers to profit at February expiration in the event that Splunk shares rally another 12% to exceed the average breakeven price of $35.41. But, not all of the activity is in SPLK calls; trading traffic is also robust in the Jan. $30 strike put options. Traders exchanged around 1,300 puts at the Jan. $30 strike versus previously existing open interest of 446 contracts. Put players paid an average premium of $0.42 per contract, and may profit at expiration in the event that Splunk’s shares slip 6.5% from the current price to trade below $29.58.
GNK - Genco Shipping & Trading, Ltd. – Call options looking for shares in drybulk shipping company, Genco Shipping & Trading, Ltd., to rally substantially during the next five weeks were active this morning as shares in the name moved higher. The stock gained more than 4% during the first 15 minutes of the session, hitting an intraday high of $4.24. However, the stock was unable to hang onto earlier gains, and currently trades down 4% on the day at $3.91 as of 12:40 p.m. in New York. Traders positioning for Genco’s shares to extend the start-of-session rally purchased more than…
GM - General Motors Co. – A couple of bullish bets in options covering automobile manufacturer, General Motors, may prove prudent investments for some strategists should shares in GM increase approximately 15.0% by January expiration. Shares in the Detroit, MI-based company are on the rise in early-afternoon trade, standing 0.45% higher on the session at $26.54 as of 12:10 pm in New York. It looks like options players initiated two ratio call spreads this morning. The larger of the transactions involved the purchase of 3,602 calls at the Jan. 2012 $26 strike at a premium of $2.82 each, against the sale of 7,204 calls up at the Jan. 2012 $30 strike for a premium of $1.22 apiece. Net premium paid for the spread amounts to $0.38 per contract, thus positioning the trader to make money should shares in the automaker exceed the effective breakeven price of $26.38 at expiration in January. The investor could rake in maximum potential profits of $3.62 per contract in the event that shares in GM rally 13.0% to settle at $30.00 at expiration next year. Meanwhile, the smaller and more optimistic of the trades engaged the purchase of 1,000 Jan. 2012 $27 strike calls for an average premium of $2.37 each, and the sale of twice as many of the Jan. 2012 $31 strike contracts at an average premium of $0.97 a-pop. The net cost of the spread amounts to $0.43 apiece, and therefore an average breakeven share price of $31.43. Maximum potential profits of $3.57 per contract are available on the trade should shares in the car maker surge 16.8% to settle at $31.00 at expiration day. Shares in GM last traded above $31.00 back in mid-July.
BCSI - Blue Coat Systems, Inc. – Call options on Blue…
This is a non-trading topic, but I wanted to post it during trading hours so as many eyes can see it as possible. Feel free to contact me directly at firstname.lastname@example.org with any questions.
Last fall there was some discussion on the PSW board regarding setting up a YouCaring donation page for a PSW member, Shadowfax. Since then, we have been looking into ways to help get him additional medical services and to pay down his medical debts. After following those leads, we are ready to move ahead with the YouCaring site. (Link is posted below.) Any help you can give will be greatly appreciated; not only to help aid in his medical bill debt, but to also show what a great community this group is.
As if Ukraine was not struggling through enough turmoil currently, Bloomberg reports that the fragile coalition government has collapsed after two parties quit. The UDAR and Svoboda parties said they’d leave the government and seek a snap parliamentary ballot. Tempers have been fraying recently as numerous brawls have broken out in parliament ahead of President Poroshenko's pledge to call elections this year. All we have to do now is find out who Washington would like to see in power? The end result: Prime Minister Yatsenyuk j...
Advisor Perspectives welcomes guest contributions. The views presented here do not necessarily represent those of Advisor Perspectives.
The BCI at 179.2 is up from last week’s 178.5. The BCIg, the smoothed annualized growth of BCI, at 22.2 is at its highest level in the current business cycle, rising from last week's 21.6. This week’s BCI does not indicate a possible recession in the near future.
Figure 1 plots BCIp, BCI, BCIg and the S&P500 together with the thresholds (red lines) that need to be crossed to be able to call a recession. Figure 2 plots the history of BCI, BCIg, and the LOG(S&P500) since July 1967, i.e. the last 44 years which include seven recessions, each which the BCI managed to indicate timely.
A large call spread initiated on Orexigen Therapeutics, Inc. (Ticker: OREX) on Monday morning looks for shares in the name to rally approximately 30% by September expiration. The September expiration is noteworthy as the company awaits the results of the FDA’s review of its resubmitted New Drug Application (NDA) for NB32, an investigational medication being evaluated for weight loss, after the review was extended for three months back in June. The upcoming Prescription Drug User Fee Act (PDUFA) date is September 11, 2014, according to a press release issued by the company. Shares in Orexigen today are up roughly 0.40% at $5.34 as of 2:15 p.m. ET.
Despite a highly eventful week in the news, not much has changed from a stock market perspective. No doubt, investors have grown immune to the daily reports of geopolitical turmoil, including Ukraine vs. Russia for control of the eastern regions, Japan’s dispute with China over territorial waters, Sunni vs. Shiite for control of Iraq, Christians being driven out by Islamists, and other religious conflicts in places like Nigeria and Central African Republic. But last Thursday’s news of the Malaysian airliner tragically getting shot down over Ukraine, coupled with Israel’s ground incursion into Gaza, had the makings of a potential Black Swan event, which in my view is the only thing that could derail the relentless bull march higher in stocks.
Nevertheless, when it became clear that the airline...
Reminder: OpTrader is available to chat with Members, comments are found below each post.
This post is for all our live virtual trade ideas and daily comments. Please click on "comments" below to follow our live discussion. All of our current trades are listed in the spreadsheet below, with entry price (1/2 in and All in), and exit prices (1/3 out, 2/3 out, and All out).
We also indicate our stop, which is most of the time the "5 day moving average". All trades, unless indicated, are front-month ATM options.
Please feel free to participate in the discussion and ask any questions you might have about this virtual portfolio, by clicking on the "comments" link right below.
To learn more about the swing trading virtual portfolio (strategy, performance, FAQ, etc.), please click here
We tried holding up stock prices but couldn’t get the job done. Market Shadows’ Virtual Value Portfolio dipped by 2% during the week but still holds on to a market-beating 8.45% gain YTD. There was no escaping the downdraft after a major Portuguese bank failed. Of all the triggers for a large selloff, I’d guess the Portuguese bank failure was pretty far down most people's list of "things to worry about."
All three major indices gave up some ground with the Nasdaq composite taking the hardest hi...
Reminder: Pharmboy is available to chat with Members, comments are found below each post.
Well PSW Subscribers....I am still here, barely. From my last post a few months ago to now, nothing has changed much, but there are a few bargins out there that as investors, should be put on the watch list (again) and if so desired....buy a small amount.
First, the media is on a tear against biotechs/pharma, ripping companies for their drug prices. Gilead's HepC drug, Sovaldi, is priced at $84K for the 12-week treatment. Pundits were screaming bloody murder that it was a total rip off, but when one investigates the other drugs out there, and the consequences of not taking Sovaldi vs. another drug combinations, then things become clearer. For instance, Olysio (JNJ) is about $66,000 for a 12-week treatment, but is approved for fewer types of patients AND...
I just wanted to be sure you saw this. There’s a ‘live’ training webinar this Thursday, March 27th at Noon or 9:00 pm ET.
If GOOGLE, the NSA, and Steve Jobs all got together in a room with the task of building a tremendously accurate trading algorithm… it wouldn’t just be any ordinary system… it’d be the greatest trading algorithm in the world.
Well, I hate to break it to you though… they never got around to building it, but my friends at Market Tamer did.
Note: The material presented in this commentary is provided for
informational purposes only and is based upon information that is
considered to be reliable. However, neither MaddJack Enterprises, LLC
d/b/a PhilStockWorld (PSW) nor its affiliates
warrant its completeness, accuracy or adequacy and it should not be relied upon as such. Neither PSW nor its affiliates are responsible for any errors or omissions or for results obtained from the use of this information. Past performance, including the tracking of virtual trades and portfolios for educational purposes, is not necessarily indicative of future results. Neither Phil, Optrader, or anyone related to PSW is a registered financial adviser and they may hold positions in the stocks mentioned, which may change at any time without notice. Do not buy or sell based on anything that is written here, the risk of loss in trading is great.
This material is not intended as an offer or solicitation for the purchase or sale of any security or other financial instrument. Securities or other financial instruments mentioned in this material are not suitable for all investors. Any opinions expressed herein are given in good faith, are subject to change without notice, and are only intended at the moment of their issue as conditions quickly change. The information contained herein does not constitute advice on the tax consequences of making any particular investment decision. This material does not take into account your particular investment objectives, financial situations or needs and is not intended as a recommendation to you of any particular securities, financial instruments or strategies. Before investing, you should consider whether it is suitable for your particular circumstances and, as necessary, seek professional advice.