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Thursday Virtual Portfolio Moves

November 15th, 2007 at 9:39 am | Permalink   edit   copy

GRMN – too trendy for me (although I like CROX). I do like the Apr $95s for $12.20 because you can roll to the $90s for $2 and the $85s for $4.50 and you can sell the Dec $95s for $4.50.

LTP – you can look at the main virtual portfolio view or you can assume a position of a similar strike price that is Nov or Dec is a sold position and not a LONG TERM Virtual PORTFOLIO position.

Thanks Opt – it is a nice, mellow way to enjoy the markets…

Respect the channel guys, we may be here for a long time!

November 15th, 2007 at 9:44 am | Permalink   edit   copy

I really was very surprised at how many of those LTP positions I’m bullish about, it made me think long and hard about whether or not we can really bottom out here and I think if the dollar can hold up and we don’t go racing back to 13,600 before we’re ready, we could have a nice Dec/Jan but I am worried about my 14,500 by summer target.

November 15th, 2007 at 10:02 am | Permalink   edit   copy

DRYS has a lot of debt and little cash and will not fare well if the global economy slows down. That’s a big if by they are not what I consider a bullet-proof stock.

Premiums dropping – that is the point of staying at least 6 months long, it insulates you (and lets you take advantage of) volatility fluctuations.

November 15th, 2007 at 10:24 am | Permalink   edit   copy

I was hoping for more of a run in the oil patch this morning, not to many fun plays to short into but the XOM $85 puts will make a nice mo play if there’s a build a swill CVX $85 puts.

GE – yest to the ‘09 $40s. As a shareholder (my retirement account) I like the fact that they would rather own up to the loss than put $24M of their own money into it (as that was all the gap was) to cover it up.

November 15th, 2007 at 10:26 am | Permalink   edit   copy

HOV ‘10 $10s for $4.55, selling the Dec $10s for $1. XXX I’m willing to risk $3.55 that they don’t go bankrupt against a 25% monthly income!

November 15th, 2007 at 10:32 am | Permalink   edit   copy

V bottoms – I belive in V bottoms but only in retrospect, the only difference between a V bottom and laddering down is what happens next. I’ll call a bottom (like here at 13,000) because I feel the bad news is adequately priced in, that good news is being ignored and, as I mentioned last weekend, as I see currency fluctuations haven’t been properly priced into forecasts (which make all those long-range charts pointless). Just because I think this is a bottom certainly doesn’t mean I think we are going right back to 14,000 because we touched 13,000 and we’re done with it. 14,000 was overbought, this is not oversold.

HUGE BUILD!! 2.8M Barrels – Bwah ha ha!!! Draw in distillates of 2M and a 700K build in gasoline.

November 15th, 2007 at 10:34 am | Permalink   edit   copy

AppleFly and Iron Bidu – If you can’t get the spreads – don’t! The risk/reward quickly becomes not worth it if you can’t keep the risk low. With BIDU, just make an offer for what you want, ignore the bid ask as they are all over the place.

Thanks Greg!

November 15th, 2007 at 10:35 am | Permalink   edit   copy

Oh yeah – don’t forget tomorrow is expiration day – nothing you see today is necessarily real…

November 15th, 2007 at 11:19 am | Permalink   edit   copy

RIMM is totally manipulated. Very good time to roll down longs and take out puts. XXX

November 15th, 2007 at 11:54 am | Permalink   edit   copy
LULU did something bad. I think they don’t really use seaweed in their clothes or something silly but a trendy company can never betray the consumers so I’d stay away. PNW seems to have suffered enough but I sure wouldn’t go long on them. There is no way I would short CAT, the global growth story is intact, just taking a rest.

Speaking of ridiculous premiums, someone just gave me .55 for the CAT Nov $70s – I love expiration week!

BIDU puts – I took out my putters but I’m not sure they’re going below $340. I’ll probably be selling those if I can get $10 against my longer puts.

NDAQ – if you can get it cheap and you are planning to buy more at $40 then I like it. If the Nas goes down, NDAQ goes with it but that’s a juicy premium on the Dec $42.50s ($2.33) so you can assume they pull themselves together by June and take the June $42.50s for $6.25 as a nice spread (and the roll downs are very cheap).

FSLR – now way do I buy that stock, the calls can’t possibly protect you enough. I ended up selling my calls as I got tired of the ridiculous up and downs (too much attention required) but I’m warming up to them again down here as you can pay off 1/2 the $195s with your first sale of the Dec $195s). If you start there and next month collect another $18 and use $10 of it to roll yourself to June and suddenly you’re in business for 6 months for a net entry of $18. XXX

Bye bye BIDU

November 15th, 2007 at 11:57 am | Permalink   edit   copy

RIMM – always seems to find a way to pop at some point. I have ZERO faith in this company but it’s a cash machine for selling calls if you time it right. You can get $2.56 for the current $105s and roll them to the Dec $113s at $8.30 for $10+ collected in 2 days against the Jan $106s for $13.50 XXX

November 15th, 2007 at 12:17 pm | Permalink   edit   copy

BA – yes I like them here in the ‘09 $90s for $15. The Dec $95s are $2 but you can also sell 1/2 the Dec $90s at $4.75 for the same downside protection and the ability to stay naked or sell more later (or roll the $90 caller up to 2x the $95s if the stock starts to run). Big, slow moving stocks like BA are great because there are so many ways to make adjustments and they rarely snap at you either way.

DIA puts – they are there to protect all my naked positions from all the putters I bought out yesterday. As I recover I reduce the DIAs but they are an insurance play, not a profit play. Meanwhile, the NYSE is down 75 and the Dow is down just 2, that’s a rubber band waiting to snap!

If the S&P fails 1,465 and the Rus fails 475 I’d feel pretty good about taking those $134 puts for a quick ride. XXX

November 15th, 2007 at 12:27 pm | Permalink   edit   copy

QQQQ Jan $50s at $2.78, selling current $50s for .62 roll to Dec is $2.12 so an almost free ride if it holds up. XXX

November 15th, 2007 at 12:30 pm | Permalink   edit   copy

Well we broke those levels pretty quick – better hang on!

November 15th, 2007 at 12:45 pm | Permalink   edit   copy

Blowing through levels, not looking good at all. FSLR $185 puts are fun mo at $2.55 with $2 stop. XXX

November 15th, 2007 at 12:53 pm | Permalink   edit   copy

Looks like we may hold 2,825 S&P and 1,460 Nas but if the Dow can’t retake 13,200 it’s probably just a rest on the way down.

November 15th, 2007 at 1:00 pm | Permalink   edit   copy

If Apple goes red I think we lose it. BIDU making a critical breakdown here. Watch GS to head back to $220 if we fail these levels. I like the GS $220 puts for .73

November 15th, 2007 at 2:15 pm | Permalink   edit   copy

RIMM risk – Of course it’s risky but you’re going to roll him anyway and his premium WILL expire no matter which way it goes. Again, as I said to Ali before – I’m not picking random contracts, there’s a lot of price targeting research that goes into these things. RIMM, for example is filling the gap it formed in the last earnings period (10/4) so we can assume a level of support. Part of the reason for the sell-off is the weak dollar and that’s probably played out at this point and, of course, $100 is good psychological support for a stock that was at $135 just 8 days ago. Again, I’m looking at us trading in a channel for a while so it’s always a good time to look for mini bottoms.

Notice the way APPL bounced right of going negative?

IPhone – ah, I read my mail but write very little on it. I think they should flip the keyboard, then it would be great to type on.

DUG Nov caller – do nothing, he paid you a premium and you are going to collect it, you will roll him up to Dec $44s for + $2 just like you would have done before except now it is becomming possible to roll himto the $45s for almost the same and that would be a better play. The Aprils are very slow movers at $9.90, that’s good to know.

OXPS – I like the idea of shaving off callers while you roll, it’s good for a bullish posture. I’d sell everything and buy the Jan ‘09 $25s for $8.10 and roll your callers in to the Dec $30s at $1.55 which covers you far better than options cover your contracts and you can’t be called away and if this first sale works and you sell Jans for the same you will have wiped out your obligation to your caller and taken 40% of your trade off the table with 4 more months to sell (and you are $5 in the money to your caller). Keep enough money to roll yourself to the $22.50s for $1.50 and you can withstand a 20% drop in the stock with little concern.

November 15th, 2007 at 2:59 pm | Permalink   edit   copy

FSLR – you can’t be “generous” with your spreads. Better off not doing them. We must do 50 a week, there will be another one if you miss it. Anyway, he’s not in the money so moot point I think…

T used to own Lucent and they were the best science in the country next to IBM’s research in Armonk. What sedating market are you looking at Film? The loophole I know nothing about – I hate accounting!

SLB – if you intend to keep playing long-term, sure, roll both down.

QLD – it’s interesting but I’d want to see it tested first.

BA – remind me later (although later is getting to be weekends lately)

AAPL shorts – done.

BBD – I’d call a turn if I saw one before 13,000

BA – always roll down if your caller is paing for it.

November 15th, 2007 at 3:07 pm | Permalink   edit   copy

Getting worse, not better!

November 15th, 2007 at 3:18 pm | Permalink   edit   copy

Wow $1.50 for the DIA $130s, .13 premium… I have to play those. XXX

November 15th, 2007 at 3:36 pm | Permalink   edit   copy

AAPL spread – No adjustment. Everything is proceeding as I have forseen… (that line doesn’t really work without the creepy voice).

DIA – yes Nov. I am keeping them for overnight but I barely have any yet so I’ll probably switch to the $129s when I take my next round (if this sell-off ever stops).

BIDU condor – I never got it, glad now.

November 15th, 2007 at 3:38 pm | Permalink   edit   copy 

CFC NOT the same as HOV – HOV has a business.

IBM holding on!

November 15th, 2007 at 4:00 pm | Permalink   edit   copy

IMCL – I like them but bad, bad performer. Have to see what happens after expiration..

DIA – yes, I think we bounce back hard tomorrow. Someone is buying SBUX – need I say more?

November 15th, 2007 at 4:22 pm | Permalink   edit   copy

Speaking of patterns, check out BIDU’s close 2 days in a row.

AAPL Apr/Dec – Well that actually worked out very well for you! It costs you $4 to roll to the $170s, you always want to stay near the money for yourself. The long Apple pricing is freaky as it doesn’t deteriorate much as Apple goes down even $20. That means you want to put your caller in a place where he will suffer from a dip and that’s the Dec $165s, where he loses $3 on a $5 down move, more than enough to roll you a bracket. This way, you are bulletproof on the way down as he pays for all your rolls.

You don’t have to time the reverse because you have a 4 months advantage on him and he WILL lose his $11 in premium on Dec 21st. On that expiration, you can roll him up a minimum of $5 (see the deep in the money Nov/Dec rolls) and, if Apple stays near $165, then the same $10 roll to the Jan $165s, which would make your Aprils effectively free.

STX – not today. At 13,000 I’m shopping, at 13,300 I’m selling and in between I’m mildly amused.

FIZZ – I was so disappointed in them this summer I can’t go back!

CROX – they always seem to turn a corner, then a block later there’s antother corner and they turn that one etc…

Dec index options. I’d work into a longer strangle maybe – remind me to look tomorrow.

November 15th, 2007 at 4:36 pm | Permalink   edit   copy 

SBUX – it wasn’t a joke, someone was buing into the close, then it fell off a cliff. Profits are up 36% but they lowered guidance so they are getting killed. I wish I had sold more against them but that’s OK, I still like my ’09s and now I can roll down cheaply.

You are very welcome Parchesia. As long as you set sensible stops, they are lots of fun to play. You win some and you lose some but sometimes you hit the jackpot. The most important thing to learn is that when you’ve got a winner, you kind of know it so when you have doubts, it’s better to get out than add risk, there’s always another play if you have cash.

William – That’s what was supposed to happen! At this point you should put a stop on him at about $2.50 as it would be silly to give up those gains. Remind me tomorrow and we’ll see if we should roll but, on the whole, not a bad couple of day’s work…

Googlefly – yes those paper losses can really freak you out. Your logic is good including the fact that you are double screwed if it stays around $670 next time think of it more in context of timing a play BEFORE it breaks out of your range.

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