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  1. Phil

    Practice makes perfect (or at least the 60% winners we aim for) Yodi – great attitude that has served you very well.  

    Greeks/Burr – Must listen to this song while we discuss.  If you can make separate portfolios for long and short-term holdings, that would be a good idea because it's ridiculous to apply a single number to both when the strategies are completely different.  Vega, for example, is not useful at all for predicting the value of individual options, it's merely predicting the change in your portfolio as it, in turn, reacts to a change in volatility which, itself, is highly volatile as the VIX is out of control.  So think about what these instruments are really telling you when they are all measuring each other – not much…

     Your Theta's going to look like crap with 2015 longs (especially if they are covered) as your incremental daily gain is minimal, not to mention that, when the market goes up, the VIX goes down and diminshes the "value" of your longs while, when the market goes down, the VIX goes up and your short puts go way against you – so you get a highly inflated negative view of your portfolio that way.  Dan Passerelli is pretty good with the Greeks, if you're interested, he wrote a good book on them.  

    I will bet you that, if you ask Buffett what his Delta, Vega and Theta are he'll tell you – "How the Hell should I know" or something to that effect.  Delta is useful if you are not capable of simply seeing that "Gee, the Dow went up 100 points and my portfolio made $5,000 and Tuesday the Dow dropped 200 points and my portfolio lost $8,000" and then figuring out that you are $5,000 bullish to $4,000 bearish per 100-point move so 25% more bullish than bearish and then all you have to do is find a position that pays you $1,000 if the Dow drops 100 points (like our DIA puts) and PRESTO! you're neutral.  

    And we didn't even have to look at a single Greek…

    Cruise/Canuck – I love the name but I only like cruises with the kids, not my kind of thing in general.  Put the same guys at the Akropolis and I'd be happy to fly there.  They keep offering me free cruises if I do a seminar on the boat but I'm just not into that.  

    Cyprus/Lionel – Last I heard Russia said "F it – we'll lend them some money."  

    DIA/Dawn – Oh, it's those pesky fundamentals again!  I know you don't read the posts but, just a week or so ago, I did a whole analysis of the Dow and we determined it didn't have much further to climb and that some of its components, like FDX, were pretty well overbought and could easily correct on any disappointing news.  Why?  Well, I won't force you to read it – the answer is International Exposure, especially to Europe while the RUT is exposed over 80% to the US, which is in a marked recovery.  You can't keep going back to the well of "conventional market wisdom" as if macro circumstances don't matter – especially these days – they matter a hell of a lot.  

    Cyprus/StJ – I say let them all move to North Dakota and take up fracking.  

    Very nice on conference Terra, thanks!

    IWM/Dawn – Same thing.  

    Bitcoin/Cdt – I think that was BDC.  

    Austerity/StJ – Yep, I read that one.  Actually, what's really happening is that Corporations have become much more effective at capturing the benefits of an up cycle before it has a chance to trickle down to the broader economy.  

    So the real shrinking population is the number of people who are able to benefit from economic gains (though they certainly suffer all of the losses!).  

    Good luck with the house hunt Hemas.  Try Craig's list – they are very good for that sort of thing. 

    Sensor/StJ – That's fantastic.  Especially for diabetics, who have to poke themselves constantly.  

    PGH/Kinki – Must be ex-dividend day, then.  Well, for one thing, you want to buy them back to get your dividend – the cash is in your portfolio, so no big deal and the stock is down .02 this morning so no worries there.  I'd just jump right back in and sell the next sucker the Oct $5 calls (.65) and let them call you away and cancel the premium if they want to!  

    Actually folks, that's a nice, new play.  PGH pays out .12 TODAY and you can buy them for $5.39 and sell the Oct $5 puts for .65 and tomorrow, assuming they go lower, you can sell the $5 puts, that are currently .40, for maybe .50 and that would put you in for a lovely net $4.19/4.60 which makes the .47 annual dividend 11.2% while you wait to see if you get called away at $5 for another 19.3% gain in 7 months.  



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Zero Hedge

"Global LIBOR Scapegoat" Turns To Public Crowdfunding To Fund Appeal

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

While UBS agreed to pay $1.5 billion to quickly settle charges that the bank manipulated LIBOR, trader Tom "Libor is too high, 'cos I've kept it artificially high" Hayes wasn't so lucky however. Alas, Hayes' pockets weren't that deep and he was the scapegoat UBS chose to offer up to the masses in the wake of the scandal, eventually being found guilty and ...



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Phil's Favorites

Atlas Crumbles Under Weight of Italian Banks

Courtesy of Mish.

On April 12, in one of the easiest financial predictions in history, I challenged the notion that a €5 billion slush fund dubbed “Atlas” could possibly prop up €360 Billion of non-performing loans in Italian banks.

Less than a month later, “Atlas” is already a notable failure.

I seek no credit for my call, and none is due. Failure was a certainty from the start.

Instead, I question the sanity of anyone who thought such a preposterous scheme could work in the first place.

Please consider Atlas Strains to Hold up the Sky Over Italy’s Banking Sector.

A government-orchestrated, privately backed €4.25...



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Market News

News You Can Use From Phil's Stock World

 

Financial Markets and Economy

Oil Turns Lower After Bigger-Than-Forecast U.S. Crude Build (Fox Business)

A bigger-than-expected build in U.S. crude inventories to fresh record highs pushed oil markets down after an early rally on Wednesday over concerns about production cuts in Canada's oil sands region due to a wildfire.

Trade Deficit Shrinks as Goods Imports Hit Five-Year Low (Fox Business)

The U.S. trade deficit fell more than expected in March as imports of goods tumbled to their lowest level since 2010, a potential boost to first-quarter ec...



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ValueWalk

Pension Funds - Taking the Long View: The Dangers of Short-Termism

By Jacob Wolinsky. Originally published at ValueWalk.

Pension Funds – Taking the Long View: The Dangers of Short-Termism

Moderator
Scott Minerd, Managing Partner, Chairman of Investments and Global Chief Investment Officer, Guggenheim Partners

Speakers
Christopher Ailman, Chief Investment Officer, California State Teachers? Retirement System; Co-Chair, Global Capital Markets Advisory Council, Milken Institute
Scott Evans, Deputy Comptroller, Asset Management, and Chief Investment Officer, New York City Retirement Systems
Vicki Fuller, Chief Investment Officer, New York State Common Retirement Fund
Hiromichi Mizuno, Executive Managing Director and Chief Investment Officer, Government Pension Investment Fund, Japan

Intensifying global competition, flagging corporate earnings and emboldened activist investors ...



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Chart School

Market Recap May 4, 2016

Courtesy of Blain.

Wednesday was another session where indexes opened down and buyers never really showed up.  The S&P 500 fell 0.59% and the NASDAQ 0.79%. This despite a pretty positive print in the ISM data:  ISM non-manufacturing for April was 55.7, above expectations and rising from March’s 54.5 print. The employment index rose to 53.0 from 50.3 the prior month.  Factory orders rose a more-than-expected 1.1% in March.   The ADP employment report for April missed expectations with a gain of 156,000.

“I’m definitely seeing a momentum shift and this market has seemed like a momentum-driven market these few months. If momentum does shift it feels like there’s not enough economic foundation and initiatives, what the Fed is going to do. … This is a pretty good challenge point...



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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...

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Kimble Charting Solutions

Junk Bonds- Potential breakdown at triple resistance zone

Courtesy of Chris Kimble.

Many like to watch the price action of Junk Bonds, because they can send important messages about the strength or lack of in the stock market. Below looks at Junk Bond ETF JNK

CLICK ON CHART TO ENLARGE

As you can see, JNK looks to have created a double top in 2013 and 2014 and weakness in the sector soon followed. Once weakness really started to take place in this sector (2015), stocks didn’t have much luck moving higher.

JNK created a bullish reversal pattern (bullish wick pattern) the week of 2/5 and started turning high...



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Digital Currencies

Is Craig Wright The Creator Of Bitcoin? Frisby and Matonis On 'Satoshi Nakamoto'

Courtesy of ZeroHedge. View original post here.

Is Craig Wright The Creator Of Bitcoin? Frisby and Matonis On ‘Satoshi Nakamoto’

By Mark O'Byrnewww.GoldCore.com 

Craig Wright, an Australian computer scientist, self-declared cyber security expert and entrepreneur, has claimed to be the creator of Bitcoin, the elusive &l...



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OpTrader

Swing trading portfolio - week of May 2nd, 2016

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 ...



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Biotech

PRGO, VRX and an Overpriced Papa

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

By Ilene 

Remember this? It was Monday. PRGO is down from around $130 to under $100 since I started following it LAST WEEK. That's down almost 25% in a week, and almost 50% in the last year. So I wrote, 

"Perrigo CEO Joseph Papa leaves Perrigo (PRGO) to lead Valeant (VRX) while PRGO issues a warning about missing earnings expectations. Not surprisingly, PRGO stock plummeted today. 

Robert Ingram, Chairman of the [Valeant] Board, stated, "The Board has conducted a thorough search process and believes that Joe is the ideal leader for Valeant at this time. He has a strong shareholder orientation,...



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Mapping The Market

About that debate last night

Although we try to stay focused on finding and managing promising trade ideas, the comments in the comment section sometimes take a political turn (for access, try PSW — click here!). So today, Jean Luc writes,

The GOP debate last night was just unreal – are these people running to be president of the US or to lead a college fraternity! Comparing tool size? The only guy that looks semi-sane is Kasich. The other guys are just like 3 jackals right now. 

And something else – if Trump is the candidate, that little Romney speech yesterday is probably already being made into a commercial. And all these little snippets from the debate will also make some nice ads! If you are a conservative, you have to be scared now. 

Phil writes back,

I was expecting them to start throwing poop at each other &n...



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Promotions

PSW is more than just stock talk!

 

We know you love coming here for our Stocks & Options education, strategy and trade ideas, and for Phil's daily commentary which you can't live without, but there's more!

PhilStockWorld.com features the most important and most interesting news items from around the web, all day, every day!

News: If you missed it, you can probably find it in our Market News section. We sift through piles of news so you don't have to.   

If you are looking for non-mainstream, provocatively-narrated news and opinion pieces which promise to make you think -- we feature Zero Hedge, ...



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Help One Of Our Own PSW Members

"Hello PSW Members –

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 jennifersurovy@yahoo.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.

http://www.youcaring.com/medical-fundraiser/help-get-shadowfax-out-from-the-darkness-of-medical-bills-/126743

Thank you for you time!




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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...

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