Posts Tagged ‘WMB’

Bullish Speculator Hits the Mark with Cheniere Energy Strategy

Today’s tickers: LNG, WMB, KKD & LVS

LNG - Cheniere Energy, Inc. – How much would you be willing to pay for call options with five months to expiration to gain the right to buy a $7.74 stock for $12.00 a share? In the case of Cheniere Energy, one bullish strategist was willing to pay an average of $0.82 per contract, a total price tag of approximately $1.64 million, for some 20,000 September $12 strike calls back on April 14. Shares in LNG at that time had fallen 23.0% since the previous week to trade around $7.74 on the date the calls were purchased. The sizable bullish play on LNG last month left us to consider what the impetus behind such a trade might be, as well as what might be expected to drive shares up 55.0% in the five months to expiration. On Friday shares in the liquefied natural gas (LNG) provider surged 44.5% to $11.11 on news the company received government approval to export fuel to more countries. Cheniere’s shares rallied as much as 15.3% over Friday’s high of $11.11 to touch today’s intraday- and new 52-week high of $12.81 on news of the approval. Whether the call buyer was speculating on a post-export approval rally or not is unknown and perhaps rather unimportant at this point. The decision to buy the calls outright for an average premium of $0.82 per contract has, for the time being, proven well worth the initial cost. September $12 strike calls on Cheniere Energy cost as much as $2.85 per contract this morning, that’s roughly 3.5 times as much as the investor paid for the options back in April. The initial play saw the speculator layout $1.64 million, which today was worth as much as $5.7 million. Open interest of 21,483 calls at the September $12 strike suggests the investor is not surprised by the jump in value and as such shows no signs of closing the position just yet. At expiration, the trader profits…
continue reading


Tags: , , ,




Options Feeding Frenzy Gains Momentum as Shares in Ford Motor Co. Hit 8-Year High

Today’s tickers: F, ALU, WMB, TLCR, PG & LNG

F - Ford Motor Co. – The automaker’s shares jumped 6.80% during the session to an intraday high of $17.41, the highest recorded share price for Ford Motor Co. since June 3, 2002. Options on Ford are extremely well trafficked today with shares surging to new heights and the market eagerly awaiting rival General Motors Company’s public stock offering. More than 2.2 call options are changing hands on the stock for each single put in play out of the more than 704,650 contracts exchanged on the automobile maker as of 3:45 pm in New York. Nearer-term call options are the most active, with volume in November $17 strike calls exceeding 70,800 lots ahead of the closing, bell versus previously existing open interest of 45,757 contracts at that strike. The majority of those in-the-money call options were purchased for an average premium of $0.46 apiece. Call buyers at this strike make money if Ford’s shares exceed $17.46 ahead of expiration on Friday. Buying interest spread all the way up to the sky-high November $20 and $21 strikes. More than 5,000 of the November $20 strike calls were picked up for an average premium of $0.03 a-pop. The premium on these contracts will continue to rise as long as Ford’s shares head higher in the next 4 trading sessions, and may provide call buyers the opportunity to bank handsome profits ahead of expiration day. The December $20 strike calls were even more popular, with some 17,000 lots purchased at an average premium of $0.15 each. Bullish players were also seen selling in- and out-of-the-money put options across multiple expiries. Near-term November $16 strike puts were the most heavily populated as upwards of 53,250 contracts changed hands by 3:50 pm. Strong demand for the automaker’s option contracts, GM’s impending IPO and the sharp shift in Ford’s share price today helped lift the overall reading of options implied volatility on the stock 9.4% to 45.92% late in the…
continue reading


Tags: , , , , ,




Motorola-Bull Cleans Up

Today’s tickers: MOT, RIMM, WMB, CAG, PFCB & SAI

MOT – Motorola, Inc. – Shares of the maker of the Droid smartphone fell in morning trading but recovered during the session to add as much as 3 pennies or 0.35% to arrive at an intraday-high of $8.39 this afternoon. Motorola appeared on our ‘most active by options volume’ market scanner today after one options player appears to have booked profits on a previously established bullish position. It looks like the investor originally purchased roughly 28,000 calls at the September $7.0 strike for an average premium of $0.70 each back on August 19, 2010, when MOT shares were trading at a volume-weighted average price of $7.55. The appreciation in the price of the underling since the calls were purchased lifted premium on the September $7.0 strike calls, allowing the trader to sell the contracts for $1.35 in premium apiece today. Net profits on the transaction amount to $0.65 per contract. Next, it looks like the bullish player re-opened, or rolled, the position to the higher October $8.0 strike where approximately 28,000 calls were picked up at an average premium of $0.10 a-pop. The investor starts to make money on the fresh batch of calls if Motorola’s shares surge 8.5% over the current price of $8.39 to surpass the effective breakeven price of $9.10 by expiration. We note that the investor may walk away with profits on the new long call position before October expiration if circumstances going forward lift the premium on those calls and the trader opts to sell the position at an advantageous price.

RIMM – Research in Motion Ltd. – Options on the Blackberry maker are a hot ticket item today ahead of the firm’s second-quarter earnings report scheduled for release after the closing bell this afternoon. Frenzied trading ensued right out of the gate this morning with investors heavily trafficking in September and October contract call and put options. Shares are currently up 1.1% at $46.02 as of 1:45 pm ET, but earlier rallied as much as 2.3% to reign in an intraday high of $46.58. The overall reading of options implied volatility on the stock increased 5.1% in the first half of the session to top out at 58.22%, but has come off to stand just 2.6% higher on the day at 56.82%. Although more than 1.7 call options changed hands for each single put on…
continue reading


Tags: , , , , ,




Fannie Mae Put Action Explodes in Afternoon Trading

Today’s tickers: FNM, EWZ, IYR, GILD, FXI, WLP, EEM, ARG, DWA & WMB

FNM – Fannie Mae – Mortgage-financer, familiarly known as Fannie Mae, jumped onto our ‘most active by options volume’ market scanner after one investor went hog-wild with put options. Fannie’s shares slipped 3% during the trading day to $0.95 apiece. The investor appears to have traded 118,000 in-the-money put options at the March $1.0 strike for a premium of $0.15 apiece, spread against the sale of 118,000 puts at the January 2012 $1.0 strike for a premium of $0.40 each. Open interest of 156,689 puts at the March $1.0 strike indicate the trader could be buying-to-close a previously established 118,000-lot short put position initiated back in September of 2009. If this is the case, the investor is extending the short put position out to the January 2012 contract and expecting the government agency to ultimately survive the next couple of years. In this scenario, the trader keeps the $0.40 in premium on the sale of the fresh batch of put options if Fannie’s share price rallies above $1.00 by expiration in 2012. But, there are a other possible explanations for the trade. It is possible that the open interest at the March $1.0 strike is unrelated to today’s activity. In this second scenario, the trader is essentially predicting that shares will erode ahead of March expiration. If this is the case the trader sold 118,000 January 2012 $1.0 strike puts for $0.40 apiece in order to take a long 118,000-lot put stance at the March $1.0 strike for which he paid $0.15 each. The net credit received in this scenario amounts to $0.25 per contract and generates additional profits as Fannie’s shares continue to fall under $1.00. It will be interesting to see whether the open interest level at the March $1.0 strike changes to reflect the closing of a previously established long or short put position. Regardless of the direction of- or motivation behind- the transaction the large volume of the trading activity is certainly noteworthy.

EWZ – iShares MSCI Brazil Index ETF – A ratio put spread enacted on the Brazil ETF suggests we may continue to see bearish movement in the price of the underlying stock through expiration in June. Shares of the fund are down 3% to $61.80 as of 2:20 pm (EDT). The investor responsible for the transaction purchased 7,500 puts at…
continue reading


Tags: , , , , , , , , ,




Smithfield bulls like hogs

Today’s tickers: SFD, LTD, XLF, HNT, AIG, KEY, WMB & CSX

SFD Smithfield Foods, Inc. – Shares of the hog producer, pork processor, and beef processor have surged upwards by 6% to $10.50. Analysts in recent weeks used high feed prices and sluggish sales as reason enough to slash targets on food-producing companies, while there had also been concern on Smithfield’s ability to meet some forthcoming debt covenants. Corn prices have eased from $4.18 to $3.82 per bushel since the start of the month. Pork sales are also sensitive to the economy’s fortunes and sales have eased as consumers switch to cheaper grain-based foodstuffs and so perhaps today’s rally is based on expectations of a return to traditional consumption habits. Option investors crowded into the call-corral hoping that shares would continue to rise through expiration in June. The May 12.5 strike price had more than 7,200 calls purchased for 34 cents per contract while the June 12.5 strike witnessed some 2,300 calls coveted for 89 cents apiece. In order for these calls to land in-the-money, shares would need to continue to climb by another 19% from the current price. Option implied volatility has spiked to 102% from the value recorded at the start of the traded day of 77%.

LTD Limited Brands, Inc. – The specialty retailer of such brands as Victoria’s Secret and Henri Bendel has experienced a share price rally of 2% to stand at $10.88. LTD edged onto our ‘hot by options volume’ market scanner after one investor picked up a hefty chunk of puts in the August contract. Perhaps this bearish investor expects retailers to struggle through the summer months as consumers exchange their rally-caps for thrift-caps. This trader purchased 17,800 puts at the August 10 strike price for a premium of 1.25 per put option. It is possible that this trader is long the stock and is therefore utilizing the put options as downside protection should shares relapse over the next six months. The puts would begin to yield profits if shares were to decline by expiration, beginning at the breakeven share price of $8.75.

XLF Financial Select Sector SPDR – Shares of the financials ETF are slightly higher today by about 0.5% to $10.65. As usual, the fund was one of the top tickers on our ‘most active by options volume’ market scanner. One interesting trade we observed took place in the September…
continue reading


Tags: , , , , , , ,




 
 
 

Phil's Favorites

The hidden connection between obesity, heart disease and trade

 

The hidden connection between obesity, heart disease and trade

Courtesy of Ronald Labonte, University of Ottawa

This week, representatives from most of the world’s governments are meeting at a World Health Organization global conference in Uruguay to tackle the global pandemic of noncommunicable diseases (NCDs).

These NCDs are the chronic diseases — including cancers, cardiovascular diseases, respiratory diseases and diabetes — that now kill around 40 million people each year. They are responsible for 70 per cent of all deaths globally and have a much bigger impact than infectious diseases such as HIV and malaria. ...



more from Ilene

Zero Hedge

Rex Tillerson Makes "Secret" Visit To Afghanistan

Courtesy of ZeroHedge. View original post here.

One day after Rex Tillerson's visit to Saudi Arabia, which came as part of the US Secretary of State's concerted efforts to curb Iran's rapidly expanding influence in the region, including boosting the clout of Sunni-ruled Saudi Arabia in Shiite-majority Iraq, and urging Iranian militias to leave Iraq as the "fighting against ISIS comes to an end", Tillerson made an unannounced visit to Afghanistan's capital Kabul, where he is in d...



more from Tyler

Insider Scoop

Deutsche Bank Brightens Its View On Illumina

Courtesy of Benzinga.

Related ILMN Benzinga's Top Upgrades, Downgrades For October 23, 2017 Illumina Now A Buy Following Q2 Beat, Improved Sale...

http://www.insidercow.com/ more from Insider

Chart School

Large Caps Accelerate Gains; Small Caps Breakout

Courtesy of Declan.

Friday belonged to Large Cap stocks as both S&P and Dow Industrials posted gains which looked better than the less than 1% they managed. Volume climbed to register accumulation. Technicals are healthy and the S&P posted a new 'buy' trigger relative to the Russell 2000 (Small Caps).  This may end up as a blow-off top but there is nothing in Friday's action to suggest such a top is in place.


...

more from Chart School

ValueWalk

Moody's Says Hartford Could Default As Early As November

By Gary St. Fleur. Originally published at ValueWalk.

The historic headquarters of insurance giants like Aetna, and Cigna, Hartford Connecticut now faces a potential financial catastrophe.

On Thursday, October 19, it was announce that the likelihood of Hartford Connecticut, to meet its obligations for the month grows continually bleak. Moody’s has produced a press release stating their position that Hartford Connecticut is likely to default by month’s end.

]]> Get The Full Ray Dalio Series in PDF

Get the entire 10-part series on Ray Dalio in PDF. Save it to your desktop, read it on your tablet, or email to your colleagues

...

more from ValueWalk

Digital Currencies

An Evening in Wonderland

 

An Evening in Wonderland

Courtesy of 

 

 

You walk halfway across Rivington Street and in the middle of the block there’s an alley leading north, and then, inexplicably, it curves northwest. It’s remarkable in that on the Isle of Manhattan there aren’t any alleys. And this one is whimsical. Lights are strung overhead and artwork decorates the sides of the buildings as you make your way through. And then, at the end of Freemans Alley, you come to a tucked away restaurant in the back corner. It’s called Freemans (what else?).

If the setting for last night&rs...



more from Bitcoin

Mapping The Market

Puts things in perspective

Courtesy of Jean-Luc

Puts things in perspective:

The circles don't look to be to scale much!

...

more from M.T.M.

Biotech

Circadian rhythm Nobel: what they discovered and why it matters

Reminder: Pharmboy and Ilene are available to chat with Members, comments are found below each post.

 

Circadian rhythm Nobel: what they discovered and why it matters

Courtesy of Sally Ferguson, CQUniversity Australia

Today, the “beautiful mechanism” of the body clock, and the group of cells in our brain where it all happens, have shot to prominence. The 2017 Nobel Prize in Physiology or Medicine has been awarded to Jeffrey C. Hall, Michael Rosbash and Michael W. Young for their work on describing the molecular cogs and wheels inside our biological clock.

In the 18th century an astronomer by the name of Jean Jacques d'Ortuous de Ma...



more from Biotech

Members' Corner

Day of Last Dances

News today has been relentlessly terrible. A horrific mass murder happened last night in Las Vegas. (Our politician's abject failure to address gun control is beyond sickening.) And today, reports that Tom Petty died of a heart attack, followed by reports that Tom Petty is not dead, and now reports confirming that Tom Petty has passed away. 

...

more from Our Members

OpTrader

Swing trading portfolio - week of September 11th, 2017

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 ...



more from OpTrader

Promotions

NewsWare: Watch Today's Webinar!

 

We have a great guest at today's webinar!

Bill Olsen from NewsWare will be giving us a fun and lively demonstration of the advantages that real-time news provides. NewsWare is a market intelligence tool for news. In today's data driven markets, it is truly beneficial to have a tool that delivers access to the professional sources where you can obtain the facts in real time.

Join our webinar, free, it's open to all. 

Just click here at 1 pm est and join in!

[For more information on NewsWare, click here. For a list of prices: NewsWar...



more from Promotions

Kimble Charting Solutions

Brazil; Waterfall in prices starting? Impact U.S.?

Courtesy of Chris Kimble.

Below looks at the Brazil ETF (EWZ) over the last decade. The rally over the past year has it facing a critical level, from a Power of the Pattern perspective.

CLICK ON CHART TO ENLARGE

EWZ is facing dual resistance at (1), while in a 9-year down trend of lower highs and lower lows. The counter trend rally over the past 17-months has it testing key falling resistance. Did the counter trend reflation rally just end at dual resistance???

If EWZ b...



more from Kimble C.S.

All About Trends

Mid-Day Update

Reminder: Harlan is available to chat with Members, comments are found below each post.

Click here for the full report.




To learn more, sign up for David's free newsletter and receive the free report from All About Trends - "How To Outperform 90% Of Wall Street With Just $500 A Week." Tell David PSW sent you. - Ilene...

more from David



FeedTheBull - Top Stock market and Finance Sites



About Phil:

Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...

Learn more About Phil >>


As Seen On:




About Ilene:

Ilene is editor and affiliate program coordinator for PSW. She manages the site market shadows, archives, more. Contact Ilene to learn about our affiliate and content sharing programs.

Market Shadows >>