Posts Tagged ‘LIZ’

Options Feeding Frenzy Ensues At The Cheesecake Factory

 

Today’s tickers: CAKE, LIZ & K

CAKE - Cheesecake Factory, Inc. – Traders are loading up on Cheesecake Factory call and put options today, perhaps ahead of the restaurant operator’s fourth-quarter earnings report next Tuesday. Shares in CAKE rose 1.6% to stand at $31.51 as of 12:55 p.m. in New York. March expiry calls garnered much of the attention from traders, with appetite for CAKE calls outpacing that of puts by around 1.4 to 1. The Mar. $34 strike calls are the most active as some 2,780 contracts changed hands against open interest of just 20 positions. It looks like the majority of the calls were purchased by one investor at a premium of $0.25 each. The strategist may profit at expiration in the event that Cheesecake Factory’s shares rally another 8.7% to surpass the effective breakeven point and new 52-week high of $34.25. The same investor may also be responsible for the purchase of call options at the Mar. $33 strike, where roughly 750 contracts traded for an average premium of $0.54 apiece. Time stamps for trades in the Mar. $33 and $34 strike calls exactly match those of transactions in the Mar. $29 strike puts. Nearly 950 of the $29 strike put options were purchased for an average premium of $0.55. The strategist snapping up both call and put options on the stock is prepared to see CAKE’s shares make big moves in either direction. The rise in demand for Cheesecake options has the overall reading of options implied volatility 31.5% on the day at 42.3% in early-afternoon trade.

LIZ - Liz Claiborne, Inc. – Shares in the owner of Juicy Couture, Kate Spade and other retail-based premium brands rallied to a fresh 52-week high of $10.38 today, extending year-to-date gains to 23.4%. A spate of…
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Bulls Drive Up Volume In Yahoo! Options

Today’s tickers: YHOO, LIZ & SFI

YHOO - Yahoo!, Inc. – Shares in Yahoo!, Inc. surrendered gains enjoyed earlier in the session, to trade 0.40% lower on the day at $15.56 just after 2:00 PM on the East Coast. The stock rose earlier in the day after All Things Digital reported that Yahoo’s Chairman and other board members are formally meeting with two private equity firms that have made bids for the Internet company. The report was followed by heavy bullish options activity on the stock in the April 2012 contract, where it appears one or more traders enacted massive three-legged bullish spreads to position for shares to rally. It looks like the investor or investors responsible for initiating the activity sold April 2012 $14 strike put options in order to partially offset the cost of buying the April 2012 $16/$20 call spread, all for an average net premium outlay of $0.30 per contract. Of the more than 44,000 option contracts that changed hands at each strike price, it appears most of the overall volume at each was tied up in the spread. The bullish position may be a profitable one at expiration next year if Yahoo’s shares exceed the average breakeven price of $16.30. Maximum potential profits of $3.70 are available to traders should the price of the underlying soar 28.5% to exceed $20.00 at April expiration day.

LIZ - Liz Claiborne, Inc. – A large three-legged options combination on Liz Claiborne this afternoon indicates one strategist is prepared for shares in the owner of a portfolio of premium retail brands to pull back. Shares in LIZ are currently down 1.3% to stand at $8.13 as of 1:50 PM ET. It looks like the investor received a net credit of $0.01 per contract on the sale of 10,000 calls at the April 2012 $9.0…
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XLF Options Active After Buffett’s Thumbs-Up On BofA

Today’s tickers: XLF, LIZ, MRK & PSS

XLF - Financial Select Sector SPDR ETF – The financials ETF popped Thursday morning on news Warren Buffett’s Berkshire Hathaway bought $5 billion worth of cumulative perpetual preferred stock in beleaguered U.S. lender, Bank of America Corp. The XLF’s morning rally gave way to losses in early-afternoon trade as heavy selling in Germany and soaring yields on Euro-area sovereign debt reminded markets that the crisis overseas may worsen. Shares in the XLF stand 0.50% lower on the session at $12.64, erasing earlier gains of as much as 4.95% to $13.33. Nearly 430,000 option contracts have changed hands on the Financial SPDR, with traders favoring puts over calls roughly 1.8 times to 1. Much of the heavy options volume resides in contracts expiring in the next few months, but longer-dated contracts attracted sizable interest, as well. Fresh positioning in the March 2012 $13 strike call and put options suggests some strategists expect shares in the fund to stagnate. Traders appear to have sold roughly 20,000 of the March 2012 $13 strike straddle to pocket average gross premium of $2.98 per contract. Straddle-sellers may be taking advantage of inflated levels of options implied volatility on the fund, which currently stands well above historical, as well as the time-rich premium built into the price of both the calls and the puts. Investors selling the straddle benefit from the roughly .07 of a penny daily decline in the value of the position, according to the roughly -.0035 reading of Theta on both the calls and the puts. Additionally, subsiding levels of implied volatility may lower the cost of buying back the straddle at some point ahead of expiration. In seven months time, when March expiration rolls around, traders walk away with the full amount of premium received on the straddle as long as shares in the XLF settle at $13.00.…
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Energy ETF Options Portend Tough Times Ahead, but Smooth Sailing to Follow

 Today’s tickers: XLE, LIZ, NE & CBST

XLE - Energy Select Sector SPDR Fund – Two massive transactions in XLE options today suggest nearer-term pessimism on the energy sector and longer-term optimism. Shares in the fund started the session in positive territory, but the rally proved to be short-lived as shares are currently trading 0.60% lower on the day at $73.72 just before 12:50pm. The XLE, an exchange-traded fund that corresponds to the performance of the Energy Select Sector of the S&P 500 Index, jumped to the top of our ‘most active by options volume’ market scanner this morning after a huge bull call spread was purchased outright in the September contract. The transaction is a profitable one if shares in the XLE top recent highs to trade at levels not seen since mid-2008. The options player purchased 52,750 calls at the September $79 strike for a premium of $2.23 each, and sold the same number of calls up at the September $90 strike at a premium of $0.28 apiece. Net premium paid to initiate the spread amounts to $1.95 per contract, a price tag of more than $10.28 million. Profits are available to the trader should shares in the fund surge 9.8% over the current price of $73.72 to exceed the effective breakeven point at $80.95 by September expiration. Maximum potential profits implied by the spread’s parameters amount to $9.05 per contract if the price of the underlying fund jumps 22.1% in the next four months to trade above $90.00 at expiration. Meanwhile, a large put spread purchased in the nearer-term June ‘30 expiry suggests a less rosy outlook on the energy sector over the next seven weeks. The spread was likely purchased by the investor, although direction in this case is more difficult to determine as both legs of the transaction traded to the middle of the market. The pessimistic player appears to have purchased 33,330 in-the-money puts at the June $75 strike for a premium of $3.27 each, against the sale of the same number of put options at the lower June $65 strike at a premium of $0.52 a-pop. The net cost of the spread amounts to $2.75 per contract, thus yielding profits below…
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What Me Worry Thursday?

What a freakin’ recovery!

As I said on Monday: "It’s a paper tiger of a straw man we’re building for $1Tn but you HAVE to respect $1,000,000,000,000 – you just have to…  Our 5% Rule series for the S&P over the 1,155 breakdown line is the very critical 1,170, followed by 1,185, 1,200 (critical), 1,215 and 1,230 and THEN we are on the way to recovery."  Wow, that guy is AMAZING!  Anyway, so here we are at 1,170, after two days of testing the 1,155 line as a bottom so now it’s onwards and upwards to 1,185 hopefully.  I also said on Monday: "Below that, we’re not too impressed but it also won’t be very surprising if all $1Tn buys us these days is some moderate lift that isn’t strong enough to break our major technicals."

We have been casting a wide and bullish net since the crash, finally pulling some of our sideline cash for long plays on ABX, APPY, BAC, BIDU, BRK/B, BSX, C, CAT, DIA (3), DF, ERX, GOOG, LIZ, LVS, MEE, MON (3), RIG, T (2), TBT (2), TZA (shorting it), UNG and WFR.  We’re hedging heavily, of course, but it feels good to have longs again after being in cash for a while.   Our short-term bearish plays (mostly DIA and TZA) have been crushing us so far, which is good in a rally but yesterday was a bit much for us and we got a little more bearish but it looks like the G7 has adopted the "Better Red Than Dead" mantra as the World racks up astounding deficits to put off admitting that this little debt problem is not isolated to the PIIGS nations. 

Nonetheless, the global markets are rallying in unison – even while the Pound ($1.47) and the Euro ($1.26) collapse and even the Yen jumped back up last night, falling off the very BS 93.63 to the dollar it hit at 3am to psych up the Nikkei exporters back down to 92.75 this morning.  I noted weeks ago how the Yen knocked down for Japan’s open and then drifts lower into the US open virtually every night – it’s what currency traders call the "Goldman Trade" because you can bet it every single day and have a perfect quarter.  Sure it’s blatant manipulation designed to fool an entire nation of investors but, what else is new – Fuggedaboutit

So, a TRILLION Dollars down the rabbit hole in Europe – Fuggedaboutit!  I pointed out to Members in yesterday’s
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Option Trader Prescribes Bullish Risk Reversal on CVS

Today’s tickers: CVS, LIZ, ITMN, MA, V, RF, KG, HW, WSM, AEP & NTAP

CVS – CVS Caremark Corp. – Shares of the pharmacy retail chain are up 1.5% to $31.11 perhaps due, in part, to the ‘buy’ rating it received at UBS today. Optimistic options activity took place in the December contract as one investor initiated a bullish risk reversal. It appears the trader sold 4,400 puts at the December 31 strike for an average premium of 94 cents apiece in order to finance the purchase of the same number of calls at the higher December 32 strike for 63 cents each. The investor pockets a 31 cent credit on the trade, which he retains in full as long as shares remain above $31.00 through expiration. Additional profits accumulate if CVS’s shares rally above $32.00.

LIZ – Liz Claiborne, Inc. – A 15,000-lot covered call in the January 2011 contract on Liz Claiborne today suggests shares are likely to recover, albeit at a glacial pace. Shares of the apparel and accessories retailer suffered a 5% decline to $4.55 during the trading session. One investor effectively purchased shares of the underlying stock for $3.30 apiece by selling 15,000 calls at the January 2011 5.0 strike for a premium of 1.25 each. Thus, the trader stands ready to accrue gains of 51% if shares of LIZ appreciate to $5.00 by expiration. The long-term positioning of the covered call play provides several advantages to the investor. One advantage is that the call options do not expire for another 13 months, which leaves ample time for LIZ’s shares to appreciate up to the strike price of $5.00. The 15,000-lot call transaction represents nearly 50% of the total existing open interest on LIZ of 31,502 contracts. Note that shares last traded above $5.00 yesterday at approximately 10:35 am (EDT).

ITMN – InterMune, Inc. – A bull call spread on the biotechnology company today suggests shares could rally significantly by expiration in April 2010. Bullish options activity on the stock belies the more than 3% decline in ITMN’s shares during the session to $10.94. The call spread involved the purchase of 3,750 calls at the April 15 strike for an average premium of 2.25 each, marked against the sale of the same number of calls at the higher April 25 strike for 75 cents apiece. The net cost of the transaction amounts to 1.50 per…
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Popular Bank Shares Surge as Option Player Stakes a Claim

Today’s tickers: BPOP, LNCR, EEM, XLK, XL, PALM, LIZ & MI

BPOP - The ‘popular’ bank popped up on our screens this afternoon after a large-volume risk reversal was established on the stock. The massive trade was likely the work of an investor with knowledge of commercial banks as approximately 60,000 contracts were exchanged on BPOP amid a more than 12% rally in shares of the underlying to $2.60. It appears the trader purchased 30,000 now in-the-money October 2.5 strike calls for an average premium of 33 cents apiece. He funded the purchase of the calls by selling 30,000 puts at the January 2.5 strike for 43 cents each. The investor received a net credit on the transaction of 10 pennies per contract. The motivation is perhaps that this individual is swimming with the rising tide of financial names today and expects a far larger rally lifting shares towards $3.75-resistance level. If this is the case, he is likely to exercise the calls by October’s expiration and take delivery of the underlying shares to ride with the stock’s upward momentum. Even if the move continues somewhat, it would likely reverse the structure of this trade to his advantage. – Popular, Inc. –

LNCR - The provider of oxygen and respiratory therapy services attracted option bulls today with shares of the firm standing more than 13% higher for the session to $29.85. Option implied volatility on LNCR exploded 50% higher from a low of 32% this morning to an intra-day high of 48%. The burst in volatility is likely due to increased investor demand for calls on the stock as well as greater uncertainty regarding future price movements in shares of Lincare. Perhaps the rise in uncertainty stems from news that Deutsche Bank raised LNCR’s target price from $33.00 to $38.00 today and maintained their ‘buy’ rating on the stock. Investors gobbled up 2,200 September 30 strike calls for an average premium of 31 cents. The contracts will expire worthless unless shares breach the $30.00-level to land in-the-money by Friday. Bullish sentiment spread to the October 30 strike where traders coveted 2,400 calls for about 71 cents premium. Investors long the calls will begin to amass profits if shares rally through the breakeven point at $30.71 by expiration in October. – Lincare Holdings Inc. –

EEM - The emerging markets exchange-traded fund jumped higher on our ‘most active by options volume’ market scanner…
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Chart School

Weekly Market Recap May 18, 2019

Courtesy of Blain.

China – U.S. trade talk continued to dominate the week.   A heavy selloff Monday was followed by 3 up days, with Friday moderately down.

On Monday, Chinese officials announced retaliatory tariffs against the U.S., hitting $60 billion in annual exports to China with new or expanded duties that could reach 25%.

Then on Wednesday:

The Trump administration plans to delay a decision on instituting new tariffs on car and auto part imports for up to six months, according to media reports.

...

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Zero Hedge

Wall Street's Most Bearish Analyst Asks "What Did I Miss"

Courtesy of ZeroHedge. View original post here.

Authored by Wall Street's most bearish sellside strategist, Morgan Stanley's Michael Wilson

As a macro strategist, my job is to try to make a very complex world easier to understand – something that’s very difficult to do. In an era of financial repression and seemingly elevated political uncertainty, the level of complexity has felt elevated too. This has created great opportunities for the past several years as a macro strategist – first to be more bullish than the consensus in 2016-17 when markets were overly worried about the outcomes, and then last year to b...



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Phil's Favorites

What's going on with Blue Apron?

By Ilene 

The Blue Apron business model appears, perhaps, flawed. While the service is convenient, I think it would appeal mostly to very busy people who don't have time to shop for food -- but enjoy cooking -- and have enough money that the trade off between paying for food delivery vs. spending time shopping is worth it. Here's the unfortunate stock chart and some numbers from Yahoo:

The company has been losing money, and is projected to lose money again next year. Revenue is projected to decrease in 2019 from the 2018 level, but pick up again in 2020, though still below 2018's revenue. Maybe a larger company that could integrate APRN's services into its existing infrastructure should acquire APRN and save it from its apparent...



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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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Kimble Charting Solutions

Banks Sending Bearish Message To Stocks, Says Joe Friday

Courtesy of Chris Kimble.

Quality bull markets prefer to see Banks stronger than the broad markets or at least keeping up with it. Concerns often crop up when banks reflect relative weakness compared to the S&P.

This chart looks at the Bank Index (BKX) over the past few years, reflecting a falling channel of lower highs and lower lows has taken place inside of falling channel (1). This falling channel has now been in play for the past 15-months.

The index hit the bottom of the channel in December of 2018 and a counter-trend rally took place. The rally off the December lows saw the index hit the top...



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Insider Scoop

Analyst: US Sanctions 'May Not Kill Huawei'

Courtesy of Benzinga.

President Donald Trump signed an executive order Wednesday that limits how "foreign adversaries" conduct business with U.S. companies.

What Happened

The Department of Commerce said China's Huawei and 70 related companies will be included in the "Entity ...



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Biotech

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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ValueWalk

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

Excerpt:

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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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:

 

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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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