Posts Tagged ‘TYC’

Iron Condor Crops Up on Tyco International Ltd.

Today’s tickers: TYC, JWN, ACOR & MRO

TYC - Tyco International Ltd. – An investor expecting shares in Tyco International to remain range bound over the next couple of months constructed an iron condor on the industrial products company using call and put options expiring in April. Shares in Tyco are currently up 0.40% to stand at $46.98 as of 10:40am in New York. The options strategist appears to have sold the 900-lot April $48/$50 call spread to pocket an average net credit of $0.55 per contract, in combination with the sale of the 900-lot April $43/$45 put spread for an average net credit of $0.35 per contract. The iron condor yields a total net credit of $0.90 per contract, which the investor keeps in full as long as shares in Tyco International trade above $45.00 and below $48.00 through April expiration. Buying the higher-strike calls and the lower-strike puts reduces the harvestable premium on the short legs of the transaction, but also caps losses for the investor in case the position moves against him at some point. The investor faces maximum potential losses of $1.10 per contract if shares either rally above $50.00, or slip beneath $43.00 ahead of expiration day in April.

JWN - Nordstrom, Inc. – Shares in specialty fashion retailer, Nordstrom, are up 1.55% at $47.20 this morning following the firm’s better-than-expected fourth-quarter earnings report after the close of trading on Thursday. Nordstrom said it earned $1.04 a share in the quarter, beating average analyst estimates of $1.00 a share. Additionally, the retailer reported it is buying the online private sale marketplace HauteLook, which has some 4 million members, for $180 million in stock. Nordstrom is reportedly the first department store chain to purchase one of the limited-time deal, or ‘flash-sale’, websites. Trading in JWN by one…
continue reading


Tags: , , ,




Put Player Portends Additional Declines in iShares MSCI EAFE Index ETF

Today’s tickers: EFA, FTI, FBR & TYC

EFA – iShares MSCI EAFE Index Fund – Shares of the EFA, an exchange-traded fund created to yield investment results that correspond to the price and yield performance of the MSCI EAFE Index – an index designed as an equity benchmark for international stock performance with stocks from Europe, Australasia and the Far East, declined as much as 1.65% in the first half of the trading session to touch an intraday low of $50.00. One options investor was seen bracing for continued bearish movement in the price of the underlying fund through October expiration. The trader purchased a plain-vanilla put spread, buying 10,000 puts at the October $50 strike for premium of $2.31 apiece, and selling the same number of puts at the lower October $45 strike at a premium of $0.86 each. The net cost of the pessimistic play amounts to $1.45 per contract. The put spreader is prepared to make money – or realize downside protection should he hold a large position in shares of the fund – if the ETF’s shares trade below the effective breakeven price of $48.55 by expiration day. Maximum potential profits of $3.55 per contract are available to the investor if the EFA’s shares plunge 10% to settle below $45.00 at October expiration. Options implied volatility on the fund is higher by 6.8% to stand at 29.77% as of 11:55 am ET.

FTI – FMC Technologies, Inc. – The global provider of technology solutions for the energy industry popped up on our ‘hot by options volume’ market scanner in the first half of the trading day after one options investor initiated a ratio put spread in the January 2011 contract. FTI’s shares are currently down 2.05% to stand at $61.00 as of 12:10 pm ET. The put player appears to have purchased 1,000 puts at the January 2011 $55 strike at a premium of $3.95 apiece, and sold 2,000 puts at the lower January 2011 $45 strike for an average premium of $1.30 each. The net cost of the spread amounts to $1.35 per contract. Profits start to accumulate for the ratio spreader if shares of the underlying stock plummet 12.05% from the current price of $61.00 to breach the effective breakeven point on the trade at $53.65 by expiration day next year. The investor stands ready to amass maximum potential profits of $8.65 per…
continue reading


Tags: , , ,




Hewlett-Packard Bull Dabbles in Call Options

Today’s tickers: HPQ, GS, XLE, QCOM, JPM, TM, SLV, EK, GMCR & TYC

HPQ – Hewlett-Packard Co. – Shares of technology giant, Hewlett-Packard Co., are down 3.5% to $47.70 this afternoon, but the actions of one option trader indicates the stock may rebound by expiration in March. Call activity in the March contract effectively mimics a ratio call spread strategy, which positions the investor to benefit from a move higher in share price in the next couple of months. The ratio call spread took place at the March $46 strike where 5,000 in-the-money calls were purchased for a premium of $3.20 apiece. At the higher March $50 strike, 10,000 call options were sold for an average premium of $1.15 each. Assuming both trades are the work of one investor, the net cost of the bullish move amounts to $0.90 per contract. Maximum potential profits of $3.10 per contract accrue to the upside if shares of the underlying rally to $50.00 by expiration. We note that shares of Hewlett-Packard last traded above $50.00 as recently as January 21, 2010.

GS – Goldman Sachs Group, Inc. – A couple of contrasting option trades caught our eye this afternoon on investment banking institution, Goldman Sachs Group. Goldman’s shares edged 1.15% higher in late-day trading to stand at $153.22. The first and nearer-term of the two transactions appeared in the March contract. The sale of more than 6,800 call options at the March $160 strike for an average premium of $4.58 apiece is a bearish signal. Investors selling the calls apparently expect to keep the premium received today because they do not see Goldman’s share price rebounding to- or above $160.00 by expiration in March. Contrary to the call selling described previously, the April contract attracted bullish sentiment. One investor purchased a call spread by picking up 2,000 calls at the April $160 strike for a premium of $5.78 each, marked against the sale of 2,000 calls at the higher April $175 strike for about $2.05 apiece. The trader paid a net $3.73 per contract to position for a rebound in GS shares by expiration in three months time. Shares must rally approximately 7% from the current price before the call-spreader breaks even at a price of $163.73. Maximum potential profits of $11.27 per contract amass if shares surge more than 14% (from $153.22) to $175.00 ahead of April expiration.

XLE – Energy Select
continue reading


Tags: , , , , , , , , ,




More Reversal Activity for Massey Energy

Today’s tickers: MEE, INTC, IYR, TYC, XLF, YHOO, COF, SMH & MDT

MEE – The coal producer edged onto our ‘most active by options volume’ market scanner this afternoon after one investor was seen initiating a bullish reversal in the July contract. Although we could not see any obvious driver behind today’s play, the trader is looking for shares of MEE to move higher over the next month. Shares are currently up more than 1% to $19.97. The transaction involved the sale of 9,000 puts at the just-in-the-money July 20 strike price for an average premium of 1.55 apiece spread against the purchase of 9,000 calls at the July 20 strike for 2.05 each. The net cost of the trade amounts to 50 cents per contract and yields a breakeven point at $20.50. Shares must rise a paltry 53 cents from the current market price of the underlying in order for this optimistic options player to begin to amass profits. – Massey Energy Corp.

INTC– Shares of the semiconductor chip maker have enjoyed a 1% rally to $16.00 amid gains experienced by many tech-stocks today. We observed bullish investors positioning themselves for upward price movement in INTC through expiration in October. More than 15,000 calls were bought at the October 18 strike price for an average premium of 60 cents apiece. With a breakeven point located at $18.60, investors will begin to amass profits on today’s trade if shares can climb 16% by expiration day. – Intel Corporation

IYR – Shares of the real estate fund are higher by less than 0.5% to stand at $32.43. Options activity of note occurred in the September contract where it looks as though an uber-bullish call spread has been established. The purchase of 2,300 calls at the September 41 strike price for an average premium of 40 cents apiece was spread against the sale of 2,300 calls at the higher September 47 strike for about a nickel each. The net cost of the play amounts to 35 cents and yields maximum potential profits of 5.65 if shares can climb up to $47.00 by expiration. Before the party responsible for this transaction can begin to dream of profits, the price of the underlying must rise approximately 28% to the breakeven point at $41.35. – iShares Dow Jones U.S. Real Estate Index ETF

TYC – The world’s largest provider of security systems (through
continue reading


Tags: , , , , , , , ,




Option traders expect smaller swings in Emerging Market

Today’s tickers: EEM, FXI, CVTX, GE, TYC, XLF & STLD

EEM iShares MSCI Emerging Market ETF – Investors appear to be anticipating lower volatility in emerging markets, perhaps taking a cue from patterns seen in the U.S. market. Shares have experienced a rally of 3% today to $23.03 and a couple of large-volume trades caught our attention in the January 2010 contract. A sold strangle was established by selling 24,500 calls at the January 35 strike and by selling 24,500 puts at the January 10 strike price for a gross premium of 1.03. As long as shares remain ‘strangled’ by the two strike prices, the 1.03 will be retained by this investor. A sold straddle was also initiated by an investor at the January 22 strike price by selling 24,500 calls and 24,500 puts for a gross premium of 8.30 on the trade. If shares settle at $22 next year at expiration this investor goes home happy with the full premium. However, if shares should swing in either direction through the breakeven points at $30.30 on the upside or at $13.70 on the downside, this trader would be exposed to limitless losses. Option implied volatility has already come off a great deal this week falling from Wednesday’s value of 64% to today’s 56% reading.

FXI iShares FTSE/Xinhua China 25 – Shares of the China index have rallied nearly 3% to $25.83 today. One option trade that caught our eye in the April contract occurred at the 28 strike price and involved about 51,000 calls. It appears likely that the entire lot is tied to stock in some way. Perhaps this investor has sold the underlying shares and in buying call options secures a sharp exit in the event of a share price gain. If this is the case, this investor paid between 90 and 95 cents per contract for the rights to exit the short position by expiration if shares rise by about 8% to $28.

CVTX CV Therapeutics – Stealing some of the Roche-Genentech thunder, biotech firm Gilead Sciences Inc. has said it will acquire biopharmaceutical company CV Therapeutics for $1.4 billion, sending CVTX shares upward by 28% and through the current 52-week high of $16.68 to $20.59. CVTX edged onto our ‘hot by options volume’ market scanner as option traders made their moves. Most notable in the April contract was the fresh interest established at the in-the-money 20…
continue reading


Tags: , , , , , ,




 
 
 

Phil's Favorites

5 reasons the coronavirus hit Italy so hard

 

5 reasons the coronavirus hit Italy so hard

A nursing home resident in Rome is moved to a hospital. Mauro Scrobogna/LaPresse via AP

Sara Belligoni, University of Central Florida

Italy is one of the nations worst hit by the global coronavirus pandemic. As a scholar in the field of security and emergency management who has studied and worked in Italy, I have determined that there are at least five major reasons why the country is suffering so much.

1. Lots of old people

Italians have the ...



more from Ilene

Biotech/COVID-19

5 reasons the coronavirus hit Italy so hard

 

5 reasons the coronavirus hit Italy so hard

A nursing home resident in Rome is moved to a hospital. Mauro Scrobogna/LaPresse via AP

Sara Belligoni, University of Central Florida

Italy is one of the nations worst hit by the global coronavirus pandemic. As a scholar in the field of security and emergency management who has studied and worked in Italy, I have determined that there are at least five major reasons why the country is suffering so much.

1. Lots of old people

Italians have the ...



more from Biotech/COVID-19

Zero Hedge

Stocks Bid Into Month-End Despite Americans' Unprecedented Scramble For Cash

Courtesy of ZeroHedge View original post here.

Amid an ever-escalating guess at the size of pension fund re-allocations funds (latest we saw was $150 billion) into month-end, both bonds and stocks were bid early on today, but as the day wore on, bonds weakened as stocks gained (driven by record IG issuance-driven rate-locks)...

Source: Bloomberg

But while some are rebalancing into stocks, the scramble for cash among average Americans has almost never been more panicky...



more from Tyler

Kimble Charting Solutions

Tech Testing 9-Year Support, With Fear Levels At 2009 Highs!

Courtesy of Chris Kimble

Is an important Tech Index sending a bullish message to investors? It is making an attempt!

Does that mean a low in this important sector is in play? Humbly it is too soon to say at this time!

This chart looks at the Nasdaq Composite Index over the past 25-years on a monthly basis.

The index has spent the majority of the past 9-years inside of rising channel (1), as it has created a series of higher lows and higher highs. It created bearish reversal patterns in January & February as it was kissing the underside of the top of the channel and...



more from Kimble C.S.

Insider Scoop

With Everybody Stuck At Home, Investor Conferences Are Going Virtual

Courtesy of Benzinga

With the world at a COVID-19-induced standstill, many conference organizers have either gone online (Benzinga is one of them) or had to cancel upcoming events altogether. There is no clear timetable on how much longer we will be in this state.

Publicly traded companies are already limited in wh...



http://www.insidercow.com/ more from Insider

Members' Corner

10 ways to spot online misinformation

 

10 ways to spot online misinformation

When you share information online, do it responsibly. Sitthiphong/Getty Images

Courtesy of H. Colleen Sinclair, Mississippi State University

Propagandists are already working to sow disinformation and social discord in the run-up to the November elections.

Many of their efforts have focused on social media, where people’s limited attention spans push them to ...



more from Our Members

Digital Currencies

While coronavirus rages, bitcoin has made a leap towards the mainstream

 

While coronavirus rages, bitcoin has made a leap towards the mainstream

Get used to it. Anastasiia Bakai

Courtesy of Iwa Salami, University of East London

Anyone holding bitcoin would have watched the market with alarm in recent weeks. The virtual currency, whose price other cryptocurrencies like ethereum and litecoin largely follow, plummeted from more than US$10,000 (£8,206) in mid-February to briefly below US$4,000 on March 13. Despite recovering to the mid-US$6,000s at the time of writin...



more from Bitcoin

The Technical Traders

These Index Charts Will Calm You Down

Courtesy of Technical Traders

I put together this video that will calm you down, because knowing where are within the stock market cycles, and the economy makes all the difference.

This is the worst time to be starting a business that’s for sure. I have talked about this is past videos and events I attended that bear markets are fantastic opportunities if you can retain your capital until late in the bear market cycle. If you can do this, you will find countless opportunities to invest money. From buying businesses, franchises, real estate, equipment, and stocks at a considerable discount that would make today’s prices look ridiculous (which they are).

Take a quick watch of this video because it shows you ...



more from Tech. Traders

Chart School

Cycle Trading - Funny when it comes due

Courtesy of Read the Ticker

Non believers of cycles become fast believers when the heat of the moment is upon them.

Just has we have birthdays, so does the market, regular cycles of time and price. The market news of the cycle turn may change each time, but the time is regular. Markets are not a random walk.


Success comes from strategy and the execution of a plan.















Changes in the world is the source of all market moves, to catch an...

more from Chart School

ValueWalk

Entrepreneurial activity and business ownership on the rise

By Jacob Wolinsky. Originally published at ValueWalk.

Indicating strong health of entrepreneurship, both entrepreneurial activity and established business ownership in the United States have trended upwards over the past 19 years, according to the 2019/2020 Global Entrepreneurship Monitor Global Report, released March 3rd in Miami at the GEM Annual Meeting.

Q4 2019 hedge fund letters, conferences and more

The Benefit Of Entrepreneurial Activity ...

more from ValueWalk

Promotions

Free, Live Webinar on Stocks, Options and Trading Strategies

TODAY's LIVE webinar on stocks, options and trading strategy is open to all!

Feb. 26, 1pm EST

Click HERE to join the PSW weekly webinar at 1 pm EST.

Phil will discuss positions, COVID-19, market volatility -- the selloff -- and more! 

This week, we also have a special presentation from Mike Anton of TradeExchange.com. It's a new service that we're excited to be a part of! 

Mike will show off the TradeExchange's new platform which you can try for free.  

...

more from Promotions

Lee's Free Thinking

Why Blaming the Repo Market is Like Blaming the Australian Bush Fires

 

Why Blaming the Repo Market is Like Blaming the Australian Bush Fires

Courtesy of  

The repo market problem isn’t the problem. It’s a sideshow, a diversion, and a joke. It’s a symptom of the problem.

Today, I got a note from Liquidity Trader subscriber David, a professional investor, and it got me to thinking. Here’s what David wrote:

Lee,

The ‘experts’ I hear from keep saying that once 300B more in reserves have ...



more from Lee

Mapping The Market

How IPOs Are Priced

Via Jean Luc 

Funny but probably true:

...

more from M.T.M.





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 >>


As Seen On:




About Ilene:

Ilene is editor and affiliate program coordinator for PSW. Contact Ilene to learn about our affiliate and content sharing programs.