Posts Tagged ‘KBE’

Time Warner Bull Channels Stock and Option Combo Play

 Today’s tickers: TWX, KBE, KMB & AET

TWX - Time Warner, Inc. – A massive transaction combining Time Warner stock and options suggests one strategist expects bullish movement in shares of the media and entertainment company ahead of February expiration. Time Warner’s shares are currently trading 0.40% higher on the session at $33.30 as of 1:25pm. The combo-player initiated a delta neutral trade, selling 1,400,000 shares of the underlying at $33.00 each, and buying 40,000 calls at the February $34 strike for a premium of $0.56 apiece, on a 0.35 delta. This is another one of those stock and option combinations in which the investor wants to have his cake and eat it too. The short stock leg of the trade works in the event Time Warner loses value, but should the shares jump, the value of the calls is intended to swell and outpace losses on the now losing stock price. As the share price increases the delta on the calls moves higher meaning that the value of the calls appreciate at a faster rate leaving the investor better placed as a bull. In other words, gains from the rising value of the call options, given share price appreciation, will eclipse losses that accumulate from the short stance in TWX shares. Time Warner’s shares last traded above $34.00 back on May 30, 2010.

KBE - SPDR KBW Bank ETF – Large prints in March contract call options on the SPDR KBW Bank ETF this morning appear to be the work of one strategist taking profits off the table and extending bullish sentiment on the fund through expiration in a few months time. Shares of the KBE, an exchange-traded fund that replicates the performance of the KBW Bank Index and invests in regional banks and other diversified financial services industries, are currently down 0.50% to stand at $26.68 as of 12:30pm in New York. It looks like the investor originally purchased a total of 27,100 calls at the March $26 strike, picking 20,000 lots for an…
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Put Butterfly Spread on Financials ETF Points to Persisting Pessimism

Today’s tickers: XLF, CMCSA, IBB, IYR, KBE & RIG

XLF – Financial Select Sector SPDR ETF – Investors heavily favored put options over call options on the financial SPDR today despite the 4.4% rebound in the price of the underlying stock to $15.75. Earlier in the trading session shares of the XLF, an exchange-traded fund seeking investment results that correspond to the price and yield performance of the Financial Select Sector of the S&P 500 Index, increased 6.15% over Friday’s closing price of $15.09 to reach an intraday high of $16.02 in the first 30 minutes of the session. Options traders populating the fund today initiated decidedly bearish transactions signaling shares of the fund may be unable to retain the current rebound. Near-term pessimism took the form of a large-volume debit put spread in the May contract. It looks like one investor purchased 36,000 puts at the May $15 strike for a premium of $0.17 apiece, and sold the same number of puts at the lower May $14 strike for $0.07 each. The net cost of the trade amounts to $0.10 per contract, thus positioning the put player to pocket maximum potential profits of $0.90 per contract should shares decline 11.11% from the current price to breach the $14.00-level by expiration day. The trade is perhaps the work of an investor still smarting from last week’s market meltdown now taking advantage of relatively cheap downside protection today to hedge against similar catastrophic events. Bearishness spread to the June contract where another pessimistic individual enacted a put butterfly spread. The transaction involved the purchase of 10,000 now in-the-money puts at the June $16 strike for a premium of $0.67 each [wing 1] and the purchase of 10,000 puts at the lower June $14 strike for $0.23 apiece [wing 2]. The body of the butterfly, nestled between the two wings at the central June $15 strike, involved the sale of 20,000 puts for a premium of $0.41 each. The net cost of the butterfly spread amounts to just $0.08 per contract. The trade yields maximum potential profits of $0.92 per contract to the responsible party if shares of the XLF fall 4.75% from the current price to settle at $15.00 at June expiration. The investor starts to make money if shares of the financials ETF slip beneath the upper breakeven price of $15.92. Options traders exchanged more than 440,000 contracts on the…
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Qualcomm Bull Itching for a Sharp Rally in Shares by July Expiration

Today’s tickers: QCOM, KBE, XRT, GE, BAC, F, UPS, UAUA & NTRI

QCOM – Qualcomm, Inc. – The manufacturer of digital wireless telecommunications products and services received a vote of confidence by one optimistic options investor who purchased a debit call spread in the July contract today. Qualcomm’s shares rallied 0.55% in late afternoon trading to stand at $42.84 as of 2:45 pm (ET). The trader initiated the call spread by purchasing 4,000 lots at the July $46 strike for a premium of $1.00 each, marked against the sale of 4,000 calls at the higher July $49 strike for $0.37 apiece. Net premium paid for the bullish play amounts to $0.63 per contract, thus positioning the investor to amass maximum potential profits of $2.37 per contract should Qualcomm’s shares rally 14.4% over the current value of the stock to $49.00 by expiration day in July. The parameters of the transaction suggest the responsible party hopes Qualcomm’s share price shifts toward the stock’s current 52-week high of $49.80, attained back on January 8, 2010, in the next several months to expiration.

KBE – SPDR KBW Bank ETF – Shares of the SPDR KBW Bank fund, which replicates the performance of the KBW Bank Index, slipped 0.75% during the course of the trading day to stand at $28.18 with 35 minutes remaining in the session. Earlier today, one investor pocketed a net credit by selling a large chunk of call options spread against the purchase of put contracts. The trader sold 28,260 calls at the May $29 strike for a premium of $0.58 each, and purchased the same number of puts at the lower May $27 strike for $0.40 apiece. A net credit of $0.18 per contract pads the investor’s wallet as long as shares of the underlying fund trade below $29.00 through expiration day in May. Additional profits are available should shares slip beneath $27.00 in the next several weeks. The transaction may be linked to an underlying share position. If this is the case, the put options serve as downside protection should the fund’s share price erode, but the short position in calls could result in the investor having the underlying shares called away from him at expiration should the call contracts land in-the-money at that time.

XRT – SPDR S&P Retail ETF – A massive bearish transaction on the XRT, an exchange-traded fund which seeks to replicate the performance…
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The risk of 'cascading' natural disasters is on the rise

 

The risk of 'cascading' natural disasters is on the rise

Deadly debris flows came to Los Angeles after heavy rain pounded wildfire-scarred land. AP Photo/Reed Saxon

Courtesy of Farshid Vahedifard, Mississippi State University and Amir AghaKouchak, University of California, Irvine

In a warming world, the dangers from natural disasters are changing. In a ...



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Zero Hedge

China Slams Pompeo's "Ignorant And Malicious" Debt-Trap Warning

Courtesy of ZeroHedge. View original post here.

The Communist Party's simmering antipathy toward Secretary of State Mike Pompeo - which was on full display earlier this month during an unprecedented public confrontation between Pompeo and his Chinese counterpart during a meeting in Beijing - boiled over once again this week as a series of editorials in China's Global Times and China Daily newspapers attacked the secretary of state over remarks he made during a recent tour of Latin America, where he warne...



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Chart School

Weekly Market Recap Oct 21, 2018

Courtesy of Blain.

After the heavy selling the week prior there was sure to be an oversold bounce and indeed last Tuesday brought much of that.  It is always interesting to see what happens after that bounce – often in this bull market, once the indexes turn back up they move like a freight train.  This time – thus far at least – the action has been less aggressive.  Selling on Thursday took the S&P 500 right back down to the 200 day moving average and rally attempts Friday were fruitless.  In whole the S&P 500 barely budged for the week.

Yields on the 10 year have thus far held their own “breakout” level:

The Chinese market had an interesting Friday with an “...



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Insider Scoop

Morgan Stanley Downgrades A Fleet Of Freight Stocks

Courtesy of Benzinga.

Related UNP 8 Biggest Price Target Changes For Monday Benzinga's Top Upgrades, Downgrades For October 22, 2018 ...

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Kimble Charting Solutions

Stock Market Crash Deja Vu? Keep An Eye On This Pattern!

Courtesy of Chris Kimble.

Just over 3 weeks ago, I shared a chart looking at the divergence that has been brewing under the surface of the S&P 500 (NYSEARCA:SPY). Since that post, the S&P 500 finds itself in a deep pullback, with other key stock market indices hitting correction territory at their lows.

Today we provide another look at the divergence and highlight why it’s time for investors to pay closer attention. In the chart below, we compare today’s setup to 2000 and 2007 and the market crashes that followed.  Note, though, that we have NOT broken trend support yet.

Similar to today, in 2000 and 2007 the S&P 500 made a...



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Digital Currencies

Grocers: Get ready to join the blockchain party

 

Grocers: Get ready to join the blockchain party

Five people died and more than 200 got sick during a 2018 E. coli outbreak, the largest in more than a decade. The bacteria was traced to contaminated romaine lettuce. (Shutterstock)

Courtesy of Sylvain Charlebois, Dalhousie University

In the wake of this year’s large E. coli outbreak, Walmart notified its leafy green suppliers that they must be using blockchain technology to trace their products before the end of 2019.

Walmart, one of the world’s largest retailers, has be...



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ValueWalk

Vilas Fund Up 55% In Q3; 3Q18 Letter: A Bull Market In Bearish Forecasts

By Jacob Wolinsky. Originally published at ValueWalk.

The Vilas Fund, LP letter for the third quarter ended September 30, 2018; titled, “A Bull Market in Bearish Forecasts.”

Ever since the financial crisis, there has been a huge fascination with predictions of the next “big crash” right around the next corner. Whether it is Greece, Italy, Chinese debt, the “overvalued” stock market, the Shiller Ratio, Puerto Rico, underfunded pensions in Illinois and New Jersey, the Fed (both for QE a few years ago and now for removing QE), rising interest rates, Federal budget deficits, peaking profit margins, etc...



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Members' Corner

Why obvious lies still make good propaganda

 

This is very good; it's about "firehosing", a type of propaganda, and how it works.

Why obvious lies still make good propaganda

A 2016 report described Russian propaganda as:
• high in volume
• rapid, continuous and repetitive
• having no commitment to objective reality
• lacking consistency

...

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Biotech

Gene-editing technique CRISPR identifies dangerous breast cancer mutations

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

 

Gene-editing technique CRISPR identifies dangerous breast cancer mutations

Breast cancer type 1 (BRCA1) is a human tumor suppressor gene, found in all humans. Its protein, also called by the synonym BRCA1, is responsible for repairing DNA. ibreakstock/Shutterstock.com

By Jay Shendure, University of Washington; Greg Findlay, ...



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Mapping The Market

Mistakes were Made. (And, Yes, by Me.)

Via Jean-Luc:

Famed investor reflecting on his mistakes:

Mistakes were Made. (And, Yes, by Me.)

One that stands out for me:

Instead of focusing on how value factors in general did in identifying attractive stocks, I rushed to proclaim price-to-sales the winner. That was, until it wasn’t. I guess there’s a reason for the proclamation “The king is dead, long live the king” when a monarchy changes hands. As we continued to update the book, price-to-sales was no longer the “best” single value factor, replaced by others, depending upon the time frames examined. I had also become a lot more sophisticated in my analysis—thanks to criticism of my earlier work—and realized that everything, including factors, moves in and out of favor, depending upon the market environment. I also realized...



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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 ...



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Promotions

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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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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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...

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