VZ - Verizon Communications, Inc. – Upside call options are in play on Verizon this morning, with shares in the wireless carrier up better than 2.1% on the session at $44.53 on an upgrade to ‘Overweight’ from ‘Neutral’ with a 12-month target price of $50.00 at Piper Jaffray. Traders positioning for shares in Verizon to rise to their highest level since October 2012 picked up roughly 1,700 calls at the May $46 strike for an average premium of $0.64 apiece. Call buyers stand ready to profit at May expiration should shares in VZ rally another 4.7% to top the average breakeven price of $46.64. Nearer-term bullish activity is notable in the Feb. $44 strike calls, where upwards of 3,400 in-the-money options changed hands in the early going. It looks like most of these calls were purchased at an average premium of 0.82 each. Traders long the $44 strike call options make money if shares in Verizon top $44.82 by expiration in two weeks.
FINL - Finish Line, Inc. – Shares in the specialty retailer of athletic footwear and accessories are trading modestly higher on Friday, up 0.20% at $18.68 on a strong up-day for U.S. stocks. Trading traffic in Finish Line options this morning suggests one or more traders are preparing for shares in the name to slip to a new 52-week low during the next few months. Investors in the retailer have had a rough six months, with the price of the underlying declining more than 30% off a six-month high of $24.90 in September, down to a 52-week low of $16.87 on January 8th. Options traders positioning for Finish Line’s shares to pullback purchased roughly 675 puts at the May $17.5 strike for an average premium of $0.98 apiece this morning. Put buyers may profit if shares in FINL drop 11.5% from the current price of $18.68 to trade below the breakeven point at $16.52. Indianapolis-based Finish Line reports fourth-quarter earnings at the end of March.…
XLK - Technology Select Sector SPDR ETF – A sizable short straddle on the Technology SPDR ETF comprises nearly all of the day’s options volume generated on the fund as of 1:00pm in New York. It looks like the investor responsible for the transaction is hoping to see the price of the underlying settle as close to $26.00 as possible by expiration day next month. Shares in the XLK, an exchange-traded fund that corresponds to the price and yield performance of the Technology Select Sector of the S&P 500 Index, increased as much as 1.0% during the session to secure an intraday high of $25.94. The straddle-strategist appears to have sold 15,000 calls and 15,000 in-the-money puts at the May $26 strike to pocket gross premium of around $1.08 per contract. The investor keeps the full amount of premium received on the trade if shares in the XLK settle at $26.00 at expiration. The trader may walk away with some portion of the total premium as long as the ETF’s shares trade within the range of $27.08 to the upside, and $24.92 on the downside, through expiration in May. The short-straddle player will also benefit from declines in options implied volatility and the passage of time, as both factors erode premium on the options and cheapen the cost of buying back the straddle, should he choose to do so, at some future date.
FCS - Fairchild Semiconductor International – May contract call activity on the semiconductor maker appears to be the work of an options player taking a bullish stance on Fairchild ahead the company’s Thursday morning first-quarter earnings report. Shares in the San Jose, CA-based company are currently down 1.2% to stand at $19.00 in early-afternoon trade. The options strategist initiated a debit call spread, buying roughly 2,200 calls at the May $21 strike for an average premium of $0.60 each, and selling the same number of calls up at the May $23 strike at an average premium…
DISH – DISH Network Corp. – The implementation of a ratio put spread on the U.S. provider of direct broadcast satellite subscription television service this afternoon was perhaps put on by an investor looking to lock in recent share price gains. DISH shares, which are currently up 2.4% on the day to arrive at $20.77 by 3:40 pm ET, have rebounded nearly 17.5% since touching down to $17.75 on July 1, 2010. It looks like one trader purchased 3,000 puts at the December $20 strike for an average premium of $1.58 each, and sold 6,000 puts at the lower December $18 strike for an average premium of $0.83 a-pop. The investor responsible for the transaction receives a net credit of $0.08 per contract, and keeps the full amount at long as DISH’s shares exceed $20.00 through December expiration. The trader is perhaps utilizing the spread to protect the value of a position in the underlying shares. If this is the case, downside protection kicks in should shares reverse course to trade below $20.00 by expiration day. The decision to employ a ratio spread rather than a 1-by-1 spread or a plain-vanilla long put stance suggests this investor does not expect DISH shares to collapse ahead of expiration at the end of 2010. The firm is scheduled to report second-quarter earnings ahead of the opening bell on August 9, 2010.
LBTYA – Liberty Global, Inc. – It looks like one options strategist expects shares of the international producer of video, voice and broadband internet services to remain range-bound through October expiration. Liberty Global’s shares are currently down 0.20% to stand at $29.65 as of 3:05 pm ET. LBTYA reported an adjusted net loss of $2.42 a share for the second quarter of 2010 after the market closed on Tuesday. But, shares moved very little following earnings. Perhaps the lack of fluctuation in the price of the underlying shares during earnings season bolstered the strangle seller’s premonition that LBTYA’s shares are likely to trade within a specified range for the next couple of months. The investor appears to have sold roughly 10,000 puts at the October $27.5 strike for a premium of $0.70 each in combination with the sale of about the same number of calls at the October $32.5 strike for an average premium of $0.35 apiece. The trader pockets…
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.
Note from dshort: I've updated this series to include the data in yesterday's Federal Reserve release of the 2014 Z.1 Financial Accounts for Q2. Based on data extrapolations through the current close, the Q Ratio is 70% above its arithmetic mean and 83% above its geometric mean. The current valuation level is surpassed only by the turn-of-the-century Tech Bubble.
The Q Ratio is a popular method of estimating the fair value of the stock market developed by Nobel Laureate James Tobin. It's a fairly simple concept, but laborious to calculate. The Q Ratio is the total price of the market divided by the replacement cost of all its companies. Fortunately, the government does the work of accumulating the data for the calculation. The numbers are supplied in the Federal Reserve ...
In modern times, war is never what it seems. Mainstream historians preach endlessly about grand conflicts over territory, resources, political impasse, and revenge, but the cold hard reality is that all of these “motivations” are actually secondary, if they are relevant at all. As I and many analysts have covered in great detail in the past, most wars are engineered wars. International elites have long seen advantages in pitting two seemingly opposed societies or ideologies again...
The present global financial ‘crisis’ began in 2007-8. It is not nearly over. And that simple fact is a problem. Not because of the life-choking misery it inflicts on the lives of millions who had no part in its creation, but because the chances of another crisis beginning before this one ends, is increasing. What ‘tools’ - those famous tools the central bankers are always telling us they have – will our dear leaders use to tackle a new crisis when all those tools are already being used to little or no positive effect on this one?
Administradora de Fondos de Pensiones Provida S.A. (PVD) shares will not be trading on the NY Stock Exchange after today. Tomorrow, shares will be harder to sell. Strangely, I wasn't able to find information on the internet, but Paul just sent me a copy of the email he received from Interactive Brokers.
We're selling PVD out of the Virtual Portfolio today at $87.18.
From: Interactive Brokers dated July 18, 2014
Holders of AFP Provida S.A. American Depository Receipts (ADR) are advised that the Company has elected to terminate the Deposit Agreement effective 2014-09-18.
Although the stock market displayed weakness last week as I suggested it would, bulls aren’t going down easily. In fact, they’re going down swinging, absorbing most of the blows delivered by hesitant bears. Despite holding up admirably when weakness was both expected and warranted, and although I still see higher highs ahead, I am still not convinced that we have seen the ultimate lows for this pullback. A number of signs point to more weakness ahead.
In this weekly update, I give my view of the current market environment, offer a technical analysis of the S&P 500 chart, review our weekly fundamentals-based SectorCast rankings of the ten U.S. business sectors, and then offer up some actionable trading ideas, including a sector rotation strategy using ETFs and an enhanced version using top-r...
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The CBOE Vix Index is in positive territory on Friday morning as shares in the S&P 500 Index move slightly lower. Currently the VIX is up roughly 2.75% on the session at 13.16 as of 11:35 am ET. Earlier in the session big prints in October expiry call options caught our attention as one large options market participants appears to have purchased roughly 106,000 of the Oct 22.0 strike calls for a premium of around $0.45 each. The VIX has not topped 22.0 since the end of 2012, but it would not take such a dramatic move in the spot index in order to lift premium on the contracts. The far out-of-the-money calls would likely increase in value in the event that S&P500 Index stocks slip in the near term. The VIX traded up to a 52-week high of 21.48 back in February. Next week’s release of the FOMC meeting minutes f...
Despite the various opinions on Bitcoin, there is no question as to its ultimate value: its ability to bypass government restrictions, including economic embargoes and capital controls, to transmit quasi-anonymous money to anyone anywhere.
Opinions differ as to what constitutes "money."
The English word "money" derives from the Latin word "moneta," which means to "mint." Historically, "money" was minted in the form of precious metals, most notably gold and silver. Minted metal was considered "money" because it possessed luster, was scarce, and had perceive...
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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...
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