Archive for 2007

Virtual Portfolio Review / Jan 28th 2007 / EOG – INTC

EOG (2/1) – This one is bad!  While trading at 3x early ’04s level ($22),

They are projected to earn .98 for Q4, down 50% from last year but the year should come out at $4.83, down "just" 10% from ’05 when they peaked out at $80.  It’s all about how much they hedged gas production and how much they had to cut that production along with the CHK cartel to stop the price of gas from slipping back below $5.

While the GS/MS "interest" in Dominion’s $5Bcf reserve and 217Kb of oil is purported to be $15Bn (highly unlikely), EOG has a $16Bn cap with 5.5Bcf and 106Mb of crude.  Sounds like they are just about maxed out on value then doesn’t it?

Clearly EOG’s best quarters seem to be behind it with Q1 at $424M in net on $1.1B in sales but Q3 netted just $297M in profits on $968M in sales.  Against a revenue reduction of $116M cost of revenue rose $6M while SG&A climbed $7M and the dreaded "Other Expenses" jumped $39M while A/P went up a massive $180M against flat recievables and (funny story) inventory climbed $41M to $117M – more than double last year’s level! 

At least they bought back $370M worth of stock so far this year, that’s roughly 10% of all trades to keep the stock flat this year – well, down $10 but who’s counting?  All this has been very painful and Net Cash Flow is actually negative for the year (-$48M but who’s counting).

I may have been premature with my call but these guys are going down so I’ll be repositioning these to March and hope for an early spring!


FDX (3/21)-  This is turning into a terrible spread!  We have the July $120s that are down 20% and the April $100 puts that are down 18% and the earnings aren’t until 3/21 so I think I simply forgot to sell Febs as there is no reason not to have….  The good news is we can sell the March optons as they expire on the 16th but you still get overpaid for earnings by people who don’t realize they expire before the end of the month (sad but true).

If I had to guess, I’d say I played it right on the whole, they’ve gone down since we bought them (12/18) and should bottom out right about the…
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Virtual Portfolio Review / Jan 28th 2007 / APPL – DOW

Duck and cover or cut and run?

I’t’s time to review our virtual portfolio and the markets to see if we still like the stuff we have.  I’ll do a market reveiw for the Monday open but right now, let’s see where we are with our open picks:

AAPL (.78, up 46%) – I’m not going to waste time talking about how great Apple is (that’s Reinharden’s job!) but COME ON! – 2005 EPS $1.58 on $13.9Bn in sales, 2006 EPS $2.27 (+44%) on $19.3Bn (+38%) in sales, 2007 projected EPS $3.21 (+41%) on $24.28Bn (+25%) in sales, 2008 projected EPS $3.77 (+17%) on $30.56Bn (+25%) in sales…

Oh no, get me out of this stock! 

First of all, we just had a 46.2% earnings surprise in Q1 ’07 of $1.14, vs. .78 expected.  Qs 2-4 last year were $1.62 so if they have zreo growth for the rest of the year that’s $2.78 out of $3.21.  The forecast calls for the last 3 Qs of this year to grow to $2.07 (27%), just 60% of the first quarter’s growth rate.  Had Apple gone up to $107 on that news, I’d be concerned but going DOWN to $85 put them on my BUYBUYBUY list!

The assumption in the projections is Apple’s sales growth will drop in half over the next 24 months and their EPS growth will drop by 2/3.  I’m pretty sure you can arrest Jobs, put a crown of thorns on him and make him walk down the streets of Seattle with a giant Zune strapped to his back and the rest of the desciples would still figure out how to grow the company more than 17% in ’08.  Perhaps they plan on feeding Apple users to the lions?

I Added the July $85s but I will sell calls against it fast if it turns down any more.  We could see a push down to $75 before this thing really turns and we need to cash out and either go very long or wait but, no matter what, don’t enter a position on this stock you can’t double down on twice as Apple bashing is the official sport of Wall Street right now.

So my July $100s are a DD when it turns but the Apr $100s are toast and I’ll be happy to get $2.50 back.  Meanwhile, that $499/$599 pricing is not subsidized – Apple isn’t allowing subsidies!  In…
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Announcing the Great Phil’s World Book Project!

Thanks to Jared and Options Sage we are now about to embark on a grand and experimental adventure aimed at writing the best options guide ever!

Sage has written a great guidebook already and our idea is to take this to a whole new level by adding specific trades that we make throughout the year as example and incorporating ideas and advice and true stories from our members who, as any comment reader knows, are some of the sharpest traders you’re likely to come across.

We want to make something that is engaging, exciting and (if we have any room left) useful – much like I kind of hope this column is on at least a once-in-a-while basis! 

This is a very exciting project and is likely to be the first of many and we are looking for your advice on how to make everything as useful as possible.  Let’s keep in mind this is book 1 and will be more of an overview so we’re looking to make sure we cover the basic strategies but feel free to make ANY (don’t hold back) comments and suggestions under the appropriate chapter in the new  education section.  If you read a chapter and have an experience you would like to share – feel free to leave a "confessional" which we will feel free to include in the book!

We will do our best to give proper credit to everyone involved and hopefully we will all be able to point our friends to a best seller list and say – "Yeah, we wrote that!

You guys will be there for all the editing and rewriting as we move this book through the process and I want to make is a nice communal effort as I know that many of you have a lot to say and a lot of really great advice for new investors.

Needless to say that the book is (until published) for members only, especially the new one.  We will be allowing non-members to purchase the version you have access to now and we will be setting up a regular educational component where OptionsSage will be dispensing weekly advice and we will try to select a trade to make that highlights a trading strategy each Monday and follow it throughout the week.

We have also added a tab called "Intraday", where you can view all the portfolo moves as well as a section for…
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Weekly Wrap-Up


We need this market to do something.

Options plays require some volatility and going up 100, down 100, up 50 down 50 is not the kind of volatility we want!  It would be fine if the market stayed in the tight little range it's gotten itself into as we can reposition and move to more of a stock picker's market (which I actually prefer as fundamentals tend to win out) but it's a very painful transition for us to shift our virtual portfolio to begin tracking micro, rather than macro trends.

The week went out with a whimper but, on the whole, we are glad it didn't end with a bang as we were all ready for a big one (and not the cool, creation of the universe kind of Big Bang, more like the awful, horrible, everything blows up in your face kind!).  Unfortunately, we were so ready for it that we took a lot of new put positions that, so far, are not doing well.

We closed out just 22 positions this week with an average return of "just" 44% (we are so spoiled!) over 16 average days held.  I called for our third position reduction of the month on Thursday so many of the remaining spots are placeholders (very small positions) but my attempts to fully stop out were thwarted by some very lackluster movements in the market.

We had 8 losers (AXP, CHKP, GE, GOOG, HPQ, JOSB, SU and VLO) but no wipeouts (those are all still open!) and 14 winners, including doubles from AA, CY, LVS, T and YHOO.

Our only successful puts were LVS $105 puts (up 114%) and GOOG $470 puts (up 13%) while the rest were calls taken off the table.  Since I was stopping out on pullbacks though, we may have a more interesting week next week as usually things are more balanced.

We still have 68 open positions and they are almost evenly divided between puts and calls, insuring that we will neither make nor lose too much UNLESS the market does nothing – in which case we lose on both sides!  This is a very real danger we need to face up to next week and it will be time to either fold 'em or roll them so…
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Secrets to Explosive Stock Market Profits: Section 1

In section 1, I introduce the book, provide some basic thoughts on the usefulness and importance of options, and give an overview of spread trading.

NOTE FROM GREG – This book has been replaced by Sage’s new book which can be viewed on-ling HERE.

As always, comments are very welcome, and appreciated.

Secrets to Explosive Stock Market Profits: Section 2

In section 2, we delve deeper into the key concepts of options trading, including: puts, calls, the options chain, and other important terminology.


NOTE FROM GREG – This book has been replaced by Sage’s new book which can be viewed on-ling HERE.

Secrets to Explosive Stock Market Profits: Section 3

This third section shows how you can use options to practice low risk / no risk trading.  Eliminate fear by using protective puts to secure profits, and eliminate greed by using covered calls to generate profits safely.

NOTE FROM GREG – This book has been replaced by Sage’s new book which can be viewed on-ling HERE.


Secrets to Explosive Stock Market Profits: Section 4

Section 4 explains some of the bread-and-butter strategies used in options trading – spreads that allow you to profit in any market trend:

  • bull and bear call spreads
  • call calendar spreads
  • bull and bear put spreads
  • put calendar spreads

NOTE FROM GREG – This book has been replaced by Sage’s new book which can be viewed on-ling HERE.

If you have any questions or comments about this section of the book, don’t hesitate to leave them below.

Secrets to Explosive Stock Market Profits: Section 5

In the fifth section of this book, you’ll find some advanced option strategies, useful for capturing profits and managing risk, including:

  • straddles
  • strangles
  • ratio backspreads
  • butterfly spreads

NOTE FROM GREG – This book has been replaced by Sage’s new book which can be viewed on-ling HERE.


Secrets to Explosive Stock Market Profits: Section 6

Section 6 is all about making you a better stock picker.  And I don’t play favorites: this section discusses both fundamental and technical analysis, and even has a chapter on sentimental analysis.  Not to be missed.

NOTE FROM GREG – This book has been replaced by Sage’s new book which can be viewed on-ling HERE.

All you accountants, chartists, and market psychologists out there, let me know what you think!


Zero Hedge

Auto Shares Surge As Fiat, Renault Confirm Merger Talks

Courtesy of ZeroHedge. View original post here.

With President Trump in Japan for a state visit and most of Europe headed to the polls to vote in the quinquennial EU Parliamentary elections, there was enough news to keep market watchers occupied during what was supposed to be a quiet holiday weekend in the US. 

But on top of these political headlines, on Saturday afternoon, the news broke that Italian-American carmaker Fiat Chrysler had approached France's Renault with a merger proposal that would leave the shareholders of each carmaker with half of the combined company, in a tie-up that would create the world's third-largest au...

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Phil's Favorites

Trump and the problem with pardons


Trump and the problem with pardons

Courtesy of Andrew Bell, Indiana University

As a veteran, I was astonished by the recent news that President Trump may be considering pardons for U.S. military members accused or convicted of war crimes. But as a scholar who studies the U.S. military and combat ethics, I understand even more clearly the harmful long-term impact such pardons can have on the military.

My researc...

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Insider Scoop

Jefferies Sees 60-Percent Upside In Aphria Shares, Says Buy The Dip

Courtesy of Benzinga.

After a red-hot start to 2019, Canadian cannabis producer Aphria Inc (NYSE: APHA) has run out of steam, tumbling more than 31 percent in the past three months.

Despite the recent weakness, one Wall Street analyst said Friday that the stock has 30-percent upside potential. 

The Analyst

Jefferies analyst ... more from Insider

Kimble Charting Solutions

DAX (Germany) About To Send A Bearish Message To The S&P 500?

Courtesy of Chris Kimble.

Is the DAX index from Germany about to send a bearish message to stocks in Europe and the States? Sure could!

This chart looks at the DAX over the past 9-years. It’s spent the majority of the past 8-years inside of rising channel (1), creating a series of higher lows and higher highs.

It looks to have created a “Double Top” as it was kissing the underside of the rising channel last year at (2).

After creating the potential double top, the DAX index has continued to create a series of lower highs, while experiencing a bearish divergence with the S...

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Chart School

Brexit Joke - Cant be serious all the time

Courtesy of Read the Ticker.

Alistair Williams comedian nails it, thank god for good humour! Prime Minister May the negotiator. Not!

Alistair Williams Comedian youtube

This is a classic! ha!

Fundamentals are important, and so is market timing, here at we believe a combination of Gann Angles, ...

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Digital Currencies

Cryptocurrencies are finally going mainstream - the battle is on to bring them under global control


Cryptocurrencies are finally going mainstream – the battle is on to bring them under global control

The high seas are getting lower. dianemeise

Courtesy of Iwa Salami, University of East London

The 21st-century revolutionaries who have dominated cryptocurrencies are having to move over. Mainstream financial institutions are adopting these assets and the blockchain technology that enables them, in what ...

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DNA as you've never seen it before, thanks to a new nanotechnology imaging method

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


DNA as you've never seen it before, thanks to a new nanotechnology imaging method

A map of DNA with the double helix colored blue, the landmarks in green, and the start points for copying the molecule in red. David Gilbert/Kyle Klein, CC BY-ND

Courtesy of David M. Gilbert, Florida State University


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More Examples Of "Typical Tesla "wise-guy scamminess"

By Jacob Wolinsky. Originally published at ValueWalk.

Stanphyl Capital’s letter to investors for the month of March 2019.

rawpixel / Pixabay

Friends and Fellow Investors:

For March 2019 the fund was up approximately 5.5% net of all fees and expenses. By way of comparison, the S&P 500 was up approximately 1.9% while the Russell 2000 was down approximately 2.1%. Year-to-date 2019 the fund is up approximately 12.8% while the S&P 500 is up approximately 13.6% and the ...

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Members' Corner

Despacito - How to Make Money the Old-Fashioned Way - SLOWLY!

Are you ready to retire?  

For most people, the purpose of investing is to build up enough wealth to allow you to retire.  In general, that's usually enough money to reliably generate a year's worth of your average income, each year into your retirement so that that, plus you Social Security, should be enough to pay your bills without having to draw down on your principle.

Unfortunately, as the last decade has shown us, we can't count on bonds to pay us more than 3% and the average return from the stock market over the past 20 years has been erratic - to say the least - with 4 negative years (2000, 2001, 2002 and 2008) and 14 positives, though mostly in the 10% range on the positives.  A string of losses like we had from 2000-02 could easily wipe out a decades worth of gains.

Still, the stock market has been better over the last 10 (7%) an...

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Mapping The Market

It's Not Capitalism, it's Crony Capitalism

A good start from :

It's Not Capitalism, it's Crony Capitalism


The threat to America is this: we have abandoned our core philosophy. Our first principle of this nation as a meritocracy, a free-market economy, where competition drives economic decision-making. In its place, we have allowed a malignancy to fester, a virulent pus-filled bastardized form of economics so corrosive in nature, so dangerously pestilent, that it presents an extinction-level threat to America – both the actual nation and the “idea” of America.

This all-encompassing mutant corruption saps men’s souls, crushes opportunities, and destroys economic mobility. Its a Smash & Grab system of ill-gotten re...

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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 ...

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Free eBook - "My Top Strategies for 2017"



Here's a free ebook for you to check out! 

Phil has a chapter in a newly-released eBook that we think you’ll enjoy.

In My Top Strategies for 2017, Phil's chapter is Secret Santa’s Inflation Hedges for 2017.

This chapter isn’t about risk or leverage. Phil present a few smart, practical ideas you can use as a hedge against inflation as well as hedging strategies designed to assist you in staying ahead of the markets.

Some other great content in this free eBook includes:


·       How 2017 Will Affect Oil, the US Dollar and the European Union


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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 >>

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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 >>