SPLS – Staples, Inc. – Office supplies retailer Staples popped up on our market scanners this morning following a burst of activity in November expiry call options. Shares in SPLS have been moving steadily higher throughout the session, with the stock currently up 1.4% on the day at $14.95 as of 12:35 p.m. ET.
The most traded options contracts on Staples today are the Nov $16 strike calls, with roughly 7,000 contracts purchased at a premium of $0.20 each just after 10:00 a.m. ET this morning. The position makes money at expiration if shares in the retailer rally more than 8.0% over the current price of $14.95 to exceed the breakeven point at $16.20. The Nov $16 calls expire one week prior to the company’s third-quarter earnings report on November 20th.
Finally, the Nov $15 strike calls were also active this morning, with around 800 lots purchased at a premium of $0.50 each at almost the exact same time as the $16 calls were purchased.
CCL – Carnival Corp – Shares in the world’s largest cruise operator are sinking today, down as much as 8.0% during morning trading to $34.43, after the company forecast fourth-quarter earnings below analyst estimates.
Put options purchased during the final 30 minutes of the trading session on Monday appear to have generated sizable overnight profits for at least one options strategist today. Open interest in the Oct $37 puts increased by around 1,250 contracts following the prior trading session;…
PETM - PetSmart, Inc. – Shares in the specialty retailer of products and services for pets and their owners fell sharplythis morning on a downgrade to ‘reduce’ from ‘neutral’ at Nomura, with the stock currently trading 7.4% lower on the session at $64.81 as of 11:25 a.m. ET. A sizable bearish options strategy initiated on PetSmart in the early going suggests one trader is bracing for shares to extend declines during the next couple of months. It looks like the strategist purchased a 2,000-lot March $60/$65 put spread for a net premium of $1.55 per contract. The bearish position starts making money if shares in PETM decline 2.1% from the current price of $64.81 to breach the effective breakeven point at $63.45. Maximum potential profits of $3.45 per contract are available on the spread in the event that shares drop more than 7.4% to settle below $60.00 at April expiration. Two weeks ago we noted a similar bear put spread initiated on PETM; the similar-sized position was an April $60/$65 put spread purchased at a net premium of $1.80 per contract. Both positions result in maximum possible profits if shares in PetSmart drop to $60.00 by expiration in March and April.
FURX - Furiex Pharmaceuticals, Inc. – Shares in Furiex Pharmaceuticals are soaring today, up 52% to stand at $32.33 just before midday in New York, after the company confirmed that its partner, Japanese firm Takeda Pharmaceutical Co., received approval from the U.S. FDA for three new type 2 diabetes therapies designed to treat the disease in adults in combination with diet and exercise. Furiex options, which typically see daily volume of around 33 contracts on average, are far more active than usual on news of the approval, with volume topping 1,685 contracts during the first half of the session. Put options are more active than calls, with roughly two puts in play for each single call option. The stock this morning rallied 55% to an all-time high of $32.97, but had already started making moves to the upside at…
GILD - Gilead Sciences, Inc. – Bullish activity in the biotechnology company’s options jumped and shares in Gilead Sciences moved up more than 2.0% to $46.18 the same day the drug maker presented at the 2012 RBC Capital Markets’ Healthcare Conference in New York. Positive comments from management along with the impending April 19th first-quarter earnings report from the Company could be catalysts for the sizable bull call spreads accumulating in the April expiry. It looks like one investor purchased a roughly 15,000-lot April $47/$50 call spread for a net premium of $1.13 per contract to position for shares to extend gains during the next couple of months. Profits may be available on the spread in the event that Gilead’s shares rally another 4.2% to surpass the average breakeven price of $48.13, while maximum possible profits of $1.87 per contract pad the investor’s wallet should the stock surge 8.3% to top $50.00 at expiration. Gilead’s shares had realized year-to-date gains of 35.0% earlier this month after the Company’s better-than-expected fourth-quarter earnings report sent the stock up as high as $56.50 on the 6th of February. The stock subsequently came back down with a thud shortly after reaching its highest level since 2008, but the options trader responsible for the call activity this morning is poised to benefit should the stock regain its footing in the near term.
SPLS - Staples, Inc. – Shares in the office supplies retailer rallied 4.7% to $15.95 in sympathy with competitor, Office Depot, Inc., which opened sharply higher on better-than-expected fourth-quarter earnings released ahead of the opening bell this morning. Staples is scheduled to reveal its fourth-quarter performance before U.S. markets open on Wednesday, and it looks like options traders are positioning for the upward move in…
RL - Ralph Lauren Corp. – The designer of premium-brand lifestyle products ranging from men’s and women’s fashion to fragrances and home furnishings popped up on our ‘hot by options volume’ market scanner after one investor traded a large chunk of deep out-of-the-money October contract call options. Shares in Ralph Lauren Corp. fell 2.0% earlier in the session to $135.69, but recovered in early-afternoon trade to stand roughly flat on the session at $138.82 as of 12:20 pm ET. The stock currently trades a few dollars below its July 21 all-time high of $141.37. The strategist responsible for nearly all of the options volume on Ralph Lauren today appears to be taking the view that the price of the underlying shares are unlikely to soar above $155.00 within the next five weeks to October expiration. More than 9,900 call options changed hands at the October $155 strike against paltry previously existing open interest of just 372 contracts. One block of 9,075 of those calls were sold by one investor at a premium of $1.70 a-pop within the first hour of the trading session. The trader selling the calls keeps the full amount of premium received on the transaction as long as shares in Ralph Lauren fail to exceed $155.00 come expiration day. The investor may be selling the calls outright, or could be writing the options against an existing long position in the underlying shares. In the naked short scenario, the strategist may accrue losses on the position in the event that RL’s shares jump 12.9% over the current price of $138.82 to surpass the effective breakeven price of $156.70. Options implied volatility on the stock dropped 5.05% this afternoon to 46.3%. Ralph Lauren reports second-quarter earnings on November 9, 2011, well after October options expiration.…
KSS - Kohl’s Corp. – The department store operator’s shares jumped 4.25% this afternoon to an intraday high of $55.90 following the company’s first-quarter earnings release ahead of the open this morning. Kohl’s Corp. raised its full-year profit forecast to a range of $4.25 to $4.40 a share, which tops average analyst estimates of around $4.36 a share. Some strategists browsing through Kohl’s options today are positioning for the stock to extend gains, while others could be taking profits on pre-earnings positions or taking a more bearish stance on the stock in the near term. Traders picked up around 2,200 now in-the-money calls at the May $55 strike for an average premium of $0.47 each. Call buyers at this strike make money if shares in KSS exceed the average breakeven price of $55.47 through expiration next week. Meanwhile, put and call selling took place in the June contract. Traders sold roughly 1,160 calls at the June $52.5 strike for an average premium of $3.10 each, and shed 1,900 calls up at the June $55 strike at a premium of $1.40 apiece. Open interest in the June $52.5 strike calls suggests investors bought some 5,090 calls at that strike for an average premium of $1.68 each back on April 26. Traders selling the now deep in-the-money calls could be cashing in on their well-placed bullish positions. On Tuesday, around 1,000 calls were picked up at the June $55 strike for an average premium of $0.70 each. The subsequent rally in the price of the underlying has these contracts trading with an asking price of $1.70 per contract as of 2:15pm. Volume of 2,200 calls at the June $55 strike exceeds open interest of 1,592 contracts. Nearly all of the calls exchanged at that strike sold for an average premium of $1.40 each. Perhaps call sellers see shares in Kohl’s trading below $55.00 at expiration in June. Put players sold around 2,000 contracts at the June $52.5 strike…
PNC - PNC Financial Services Group, Inc. – Shares in the financial services firm are down 1.00% at $60.34 in early-afternoon trade, but activity in May contract call and put options suggests one strategist sees shares in PNC rising sharply in the next few months. The three-legged bullish player appears to have sold 5,000 puts at the May $55 strike for a premium of 1.39 each, purchased the same number of calls at the May $62.5 strike for a premium of $2.15 per contract, and shed 5,000 calls up at the May $67.5 strike at a premium of $0.68 a-pop. The options trader paid a net premium of $0.08 per contract for the transaction, and stands ready to profit should PNC’s shares reverse course and rally 3.7% over the current price of $60.34 to exceed the average breakeven price of $62.58 by expiration day in May. The investor responsible for the trade could accumulate maximum potential profits of $4.92 per contract if the firm’s shares jump 11.9% to trade above $67.50 before the options expire. PNC’s shares last traded above $67.50 back in May 2010. The financial services provider reports first-quarter earnings before the opening bell on April 21, 2011.
CEDC - Central European Distribution Corp. – Near-term options activity on the vodka producer this morning suggests some investors expect the pain of Central European Distribution Corp.’s post-earnings hangover to stick around through March expiration. Shares in CEDC lost 11.2% today to trade at $12.38, the lowest recorded price for the stock since April 2009. The alcohol beverage provider’s shares dropped 45.8% during the trading week, from a closing price of $22.85 on Monday, to today’s low of $12.38. Put buyers in the March contract, however, do not seem to think CEDC has hit…
SPLS - Staples, Inc. – Call options on the office supplies retailer are flying off the shelves ahead of the firm’s fourth-quarter earnings report, which is slated for release before the opening bell tolls on Wednesday. Shares in the name are up 1.35% to stand at $21.22 as of 12:00pm in New York. Bullish players are out in numbers, buying up call options in the March and April contracts, to position for shares to extend gains in the near term. Meanwhile, there is a bit of put buying in the front month this morning, with some 1,200 March $21 puts picked up by pessimistic traders for an average premium of $0.55 each. The largest bullish bet on Staples was the purchase of 9,000 calls at the March $22 strike at a premium of $0.40 each. The transaction appears to be tied to the sale of 270,000 shares of the underlying at $21.11 each. The strategy is likely a delta neutral play, with a delta of 0.30 indicated by the size of the stock and option combination employed. The trader could make out on the short stock leg of the trade if shares in SPLS drop post-earnings, however, the parameters of the transaction indicate substantially higher potential gains if shares fly higher in the time remaining to March expiration. A total of 11,395 calls changed hands at the March $22 strike in early-afternoon trade versus previously existing open interest of just 1,520 contracts. Like-minded optimists looked to the April $22 strike to buy roughly 2,000 calls for an average premium of $0.55 per contract. Call buyers at the April $22 strike start making money in the event that Staples’ shares surge 6.3% to surpass the average breakeven price of $22.55 by April expiration. Options implied volatility on the office supplies firm is up 4.8% at 30.82% as of 12:15pm.…
SPLS - Staples, Inc. – The supplier of office products popped up on our ‘hot by options volume’ market scanner late in the trading session after one investor initiated a bearish spread in the December contract. Staples’ shares are currently down 0.80% at $20.64 as of 3:15 p.m. in New York. The pessimistic player established a ratio put spread, buying 2,500 in-the-money puts at the December $21 strike for an average premium of $1.185 each, and selling 5,000 puts at the lower December $19 strike at an average premium of $0.39 apiece. The average net cost of the transaction amounts to $0.405 per contract. Thus, the investor is prepared to make money if the price of the underlying stock slips beneath the effective breakeven point on the spread at $20.595 by expiration day in December. Maximum potential profits of $1.595 per contract are available to the ratio-spreader if the office products company’s shares fall 7.945% from the current price of $20.64 to settle at $19.00 at expiration. The investor is vulnerable to losses in the event that Staples’ shares plummet far lower than he expects they will in the next several months. Losses start to accumulate for the trader if shares drop 15.7% lower and trade below the lower breakeven point at $17.405 by expiration day. Staples, Inc. is slated to report third-quarter earnings ahead of the opening bell on November 18, 2010.
XCO - EXCO Resources, Inc. – The oil and natural gas company was visited by one long-term bullish options investor in the second half of the trading session. It looks like the trader is expecting EXCO’s shares to rally significantly by expiration day in March of 2011. Shares of the Dallas, TX-based firm are up 2.05% at…
Please review a collection of WWW browsing results.Date Found: Friday, 16 January 2015, 09:55:47 PM
Click for popup. Clear your browser cache if image is not showing. Comment: Volatility Is back across all asset classes. Price discovery reverting to the mean.
Date Found: Saturday, 17 January 2015, 04:18:13 PM
Click for popup. Clear your browser cache if image is not showing. Comment: US Velocity of money, historic lows. $4.8 trillion on Fed balance. None of it getting to the masses. Deflation is at the door.
Date Found: Sunday, 18 January 2015, 10:44:09 PM
Click for popup. Clear your browser cache if image is not showing. Comment: Gold teasing...
"In the minds of the statists, "Government Works Better" and 'things' work at the surface; but at the core, it's a disaster... The Americans that look to the government to 'save' them - and even gleefully thank the government for helping bail them out - fail to realize that it was the government that f##ked them in the first place..."
Simply put, "debt-financed socialism and corporatism isn't working" and a day of reckoning is coming...
(ETFTrends.com by Todd Shriber): "Betting on insider buying is again proving to be an efficacious strategy as the Direxion All Cap Insider Sentiment Shares (NYSEArca: KNOW) has been noticeably less bad than the S&P 500 to start 2015. Add to that, investors are warming to the merits of KNOW's insider sentiment strategy." [Editor's note: KNOW tracks the Sabrient Multi-cap Insider/Analyst Quant-Weighted Index (SBRQAM)]. Read article
Suppose you had the technical ability and raw materials to print up counterfeit dollars, euros or yen that were identical to the real things. Assume you could spend them as fast as you could create them with no fear of any repercussions.
Would you prudently print up only as much fresh currency as you needed for your current lifestyle? Would you create just a bit more than that to help relatives or those in need?
It is most likely you’d have your printing press running 24 hours a day, seven days a week. Becoming the richest person in the world would confer great power upon you.
You could rationalize this action because you plan to use the money for good purposes. Imagine the warm feeling you’d get by giving every person in America one million do...
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
So as I was saying yesterday (Bitcoin: The Biggest Clown Show In History?), Bitcoin has several obstacles on the path to potential success as an alternative currency. But I forgot to mention hacking and theft at Bitcoin exchanges and other technical problems. This is related to the lack of government backing and the fact that the value of Bitcoins is based entirely on confidence.
Reminder: Pharmboy is available to chat with Members, comments are found below each post.
PSW Members - well, what a year for biotechs! The Biotech Index (IBB) is up a whopping 40%, beating the S&P hands down! The healthcare sector has had a number of high flying IPOs, and beat the Tech Sector in total nubmer of IPOs in the past 12 months. What could go wrong?
Phil has given his Secret Santa Inflation Hedges for 2015, and since I have been trying to keep my head above water between work, PSW, and baseball with my boys...it is time that something is put together for PSW on biotechs in 2015.
Cancer and fibrosis remain two of the hottest areas for VC backed biotechs to invest their monies. A number of companies have gone IPO which have drugs/technologies that fight cancer, includin...
Stocks got off to a rocky start on the first trading day in December, with the S&P 500 Index slipping just below 2050 on Monday. Based on one large bullish SPX options trade executed on Wednesday, however, such price action is not likely to break the trend of strong gains observed in the benchmark index since mid-October. It looks like one options market participant purchased 25,000 of the 31Dec’14 2105/2115 call spreads at a net premium of $2.70 each. The trade cost $6.75mm to put on, and represents the maximum potential loss on the position should the 2105 calls expire worthless at the end of December. The call spread could reap profits of as much as $7.30 per spread, or $18.25mm, in the event that the SPX ends the year above 2115. The index would need to rally 2.0% over the current level...
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 email@example.com 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: 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 PSW Investments, 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.
Site owned and operated by PSW Investments, LLC. Contact us at: 403 Central Avenue, Hawthorne, NJ 07506. Phone: (201) 743-8009. Email: firstname.lastname@example.org.