Posts Tagged ‘WMB’

Bullish Speculator Hits the Mark with Cheniere Energy Strategy

Today’s tickers: LNG, WMB, KKD & LVS

LNG - Cheniere Energy, Inc. – How much would you be willing to pay for call options with five months to expiration to gain the right to buy a $7.74 stock for $12.00 a share? In the case of Cheniere Energy, one bullish strategist was willing to pay an average of $0.82 per contract, a total price tag of approximately $1.64 million, for some 20,000 September $12 strike calls back on April 14. Shares in LNG at that time had fallen 23.0% since the previous week to trade around $7.74 on the date the calls were purchased. The sizable bullish play on LNG last month left us to consider what the impetus behind such a trade might be, as well as what might be expected to drive shares up 55.0% in the five months to expiration. On Friday shares in the liquefied natural gas (LNG) provider surged 44.5% to $11.11 on news the company received government approval to export fuel to more countries. Cheniere’s shares rallied as much as 15.3% over Friday’s high of $11.11 to touch today’s intraday- and new 52-week high of $12.81 on news of the approval. Whether the call buyer was speculating on a post-export approval rally or not is unknown and perhaps rather unimportant at this point. The decision to buy the calls outright for an average premium of $0.82 per contract has, for the time being, proven well worth the initial cost. September $12 strike calls on Cheniere Energy cost as much as $2.85 per contract this morning, that’s roughly 3.5 times as much as the investor paid for the options back in April. The initial play saw the speculator layout $1.64 million, which today was worth as much as $5.7 million. Open interest of 21,483 calls at the September $12 strike suggests the investor is not surprised by the jump in value and as such shows no signs of closing the position just yet. At expiration, the trader profits…
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Options Feeding Frenzy Gains Momentum as Shares in Ford Motor Co. Hit 8-Year High

Today’s tickers: F, ALU, WMB, TLCR, PG & LNG

F - Ford Motor Co. – The automaker’s shares jumped 6.80% during the session to an intraday high of $17.41, the highest recorded share price for Ford Motor Co. since June 3, 2002. Options on Ford are extremely well trafficked today with shares surging to new heights and the market eagerly awaiting rival General Motors Company’s public stock offering. More than 2.2 call options are changing hands on the stock for each single put in play out of the more than 704,650 contracts exchanged on the automobile maker as of 3:45 pm in New York. Nearer-term call options are the most active, with volume in November $17 strike calls exceeding 70,800 lots ahead of the closing, bell versus previously existing open interest of 45,757 contracts at that strike. The majority of those in-the-money call options were purchased for an average premium of $0.46 apiece. Call buyers at this strike make money if Ford’s shares exceed $17.46 ahead of expiration on Friday. Buying interest spread all the way up to the sky-high November $20 and $21 strikes. More than 5,000 of the November $20 strike calls were picked up for an average premium of $0.03 a-pop. The premium on these contracts will continue to rise as long as Ford’s shares head higher in the next 4 trading sessions, and may provide call buyers the opportunity to bank handsome profits ahead of expiration day. The December $20 strike calls were even more popular, with some 17,000 lots purchased at an average premium of $0.15 each. Bullish players were also seen selling in- and out-of-the-money put options across multiple expiries. Near-term November $16 strike puts were the most heavily populated as upwards of 53,250 contracts changed hands by 3:50 pm. Strong demand for the automaker’s option contracts, GM’s impending IPO and the sharp shift in Ford’s share price today helped lift the overall reading of options implied volatility on the stock 9.4% to 45.92% late in the…
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Motorola-Bull Cleans Up

Today’s tickers: MOT, RIMM, WMB, CAG, PFCB & SAI

MOT – Motorola, Inc. – Shares of the maker of the Droid smartphone fell in morning trading but recovered during the session to add as much as 3 pennies or 0.35% to arrive at an intraday-high of $8.39 this afternoon. Motorola appeared on our ‘most active by options volume’ market scanner today after one options player appears to have booked profits on a previously established bullish position. It looks like the investor originally purchased roughly 28,000 calls at the September $7.0 strike for an average premium of $0.70 each back on August 19, 2010, when MOT shares were trading at a volume-weighted average price of $7.55. The appreciation in the price of the underling since the calls were purchased lifted premium on the September $7.0 strike calls, allowing the trader to sell the contracts for $1.35 in premium apiece today. Net profits on the transaction amount to $0.65 per contract. Next, it looks like the bullish player re-opened, or rolled, the position to the higher October $8.0 strike where approximately 28,000 calls were picked up at an average premium of $0.10 a-pop. The investor starts to make money on the fresh batch of calls if Motorola’s shares surge 8.5% over the current price of $8.39 to surpass the effective breakeven price of $9.10 by expiration. We note that the investor may walk away with profits on the new long call position before October expiration if circumstances going forward lift the premium on those calls and the trader opts to sell the position at an advantageous price.

RIMM – Research in Motion Ltd. – Options on the Blackberry maker are a hot ticket item today ahead of the firm’s second-quarter earnings report scheduled for release after the closing bell this afternoon. Frenzied trading ensued right out of the gate this morning with investors heavily trafficking in September and October contract call and put options. Shares are currently up 1.1% at $46.02 as of 1:45 pm ET, but earlier rallied as much as 2.3% to reign in an intraday high of $46.58. The overall reading of options implied volatility on the stock increased 5.1% in the first half of the session to top out at 58.22%, but has come off to stand just 2.6% higher on the day at 56.82%. Although more than 1.7 call options changed hands for each single put on…
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Fannie Mae Put Action Explodes in Afternoon Trading

Today’s tickers: FNM, EWZ, IYR, GILD, FXI, WLP, EEM, ARG, DWA & WMB

FNM – Fannie Mae – Mortgage-financer, familiarly known as Fannie Mae, jumped onto our ‘most active by options volume’ market scanner after one investor went hog-wild with put options. Fannie’s shares slipped 3% during the trading day to $0.95 apiece. The investor appears to have traded 118,000 in-the-money put options at the March $1.0 strike for a premium of $0.15 apiece, spread against the sale of 118,000 puts at the January 2012 $1.0 strike for a premium of $0.40 each. Open interest of 156,689 puts at the March $1.0 strike indicate the trader could be buying-to-close a previously established 118,000-lot short put position initiated back in September of 2009. If this is the case, the investor is extending the short put position out to the January 2012 contract and expecting the government agency to ultimately survive the next couple of years. In this scenario, the trader keeps the $0.40 in premium on the sale of the fresh batch of put options if Fannie’s share price rallies above $1.00 by expiration in 2012. But, there are a other possible explanations for the trade. It is possible that the open interest at the March $1.0 strike is unrelated to today’s activity. In this second scenario, the trader is essentially predicting that shares will erode ahead of March expiration. If this is the case the trader sold 118,000 January 2012 $1.0 strike puts for $0.40 apiece in order to take a long 118,000-lot put stance at the March $1.0 strike for which he paid $0.15 each. The net credit received in this scenario amounts to $0.25 per contract and generates additional profits as Fannie’s shares continue to fall under $1.00. It will be interesting to see whether the open interest level at the March $1.0 strike changes to reflect the closing of a previously established long or short put position. Regardless of the direction of- or motivation behind- the transaction the large volume of the trading activity is certainly noteworthy.

EWZ – iShares MSCI Brazil Index ETF – A ratio put spread enacted on the Brazil ETF suggests we may continue to see bearish movement in the price of the underlying stock through expiration in June. Shares of the fund are down 3% to $61.80 as of 2:20 pm (EDT). The investor responsible for the transaction purchased 7,500 puts at…
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Smithfield bulls like hogs

Today’s tickers: SFD, LTD, XLF, HNT, AIG, KEY, WMB & CSX

SFD Smithfield Foods, Inc. – Shares of the hog producer, pork processor, and beef processor have surged upwards by 6% to $10.50. Analysts in recent weeks used high feed prices and sluggish sales as reason enough to slash targets on food-producing companies, while there had also been concern on Smithfield’s ability to meet some forthcoming debt covenants. Corn prices have eased from $4.18 to $3.82 per bushel since the start of the month. Pork sales are also sensitive to the economy’s fortunes and sales have eased as consumers switch to cheaper grain-based foodstuffs and so perhaps today’s rally is based on expectations of a return to traditional consumption habits. Option investors crowded into the call-corral hoping that shares would continue to rise through expiration in June. The May 12.5 strike price had more than 7,200 calls purchased for 34 cents per contract while the June 12.5 strike witnessed some 2,300 calls coveted for 89 cents apiece. In order for these calls to land in-the-money, shares would need to continue to climb by another 19% from the current price. Option implied volatility has spiked to 102% from the value recorded at the start of the traded day of 77%.

LTD Limited Brands, Inc. – The specialty retailer of such brands as Victoria’s Secret and Henri Bendel has experienced a share price rally of 2% to stand at $10.88. LTD edged onto our ‘hot by options volume’ market scanner after one investor picked up a hefty chunk of puts in the August contract. Perhaps this bearish investor expects retailers to struggle through the summer months as consumers exchange their rally-caps for thrift-caps. This trader purchased 17,800 puts at the August 10 strike price for a premium of 1.25 per put option. It is possible that this trader is long the stock and is therefore utilizing the put options as downside protection should shares relapse over the next six months. The puts would begin to yield profits if shares were to decline by expiration, beginning at the breakeven share price of $8.75.

XLF Financial Select Sector SPDR – Shares of the financials ETF are slightly higher today by about 0.5% to $10.65. As usual, the fund was one of the top tickers on our ‘most active by options volume’ market scanner. One interesting trade we observed took place in the September…
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Zero Hedge

Harvard, MIT Sue ICE Over Student Visa Guidelines

Courtesy of ZeroHedge View original post here.

Harvard University and the Massachusetts Institute of Technology filed a lawsuit against the Department of Homeland Security (DHS) and Immigration and Customs Enforcement (ICE) on Wednsday morning, seeking a temporary restraining order to prevent the agencies from enforcing federal guidelines which would prevent foreign students from remaining in the United States if their college switches to online-only classes.

...



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Phil's Favorites

"Just because you're buying stock, doesn't mean you're an investor"

 

“Just because you’re buying stock, doesn’t mean you’re an investor”

Courtesy of 

Josh here – in the mid 1960’s, investors decided that there was a group of fifty growth stocks whose outlook was so bright that it didn’t matter what price you paid for them, as long as you were buying. By the early 70’s, they were learning a critical lesson about starting valuation – McDonalds, Coke and Procter & Gamble did indeed have a very bright future, but that didn’t prevent them from being cut in half. Investors in these names would have ...



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Biotech/COVID-19

5 COVID-19 myths politicians have repeated that just aren't true

 

5 COVID-19 myths politicians have repeated that just aren't true

The purveyors of these myths aren’t doing the country any favors. Brendan Smialowski/AFP/Getty Images

Courtesy of Geoffrey Joyce, University of Southern California

The number of new COVID-19 cases in the U.S. has jumped to around 50,000 a day, and the virus has killed more than 130,000 Americans. Yet, I still hear myths about the infection that has created the worst public health crisis in A...



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ValueWalk

100 Days Since The Roll Back Of Fuel Efficiency Standards

By Anna Peel. Originally published at ValueWalk.

“100 Days Since…” Trump Rolled Back Fuel Efficiency Standards While Public Health, Economic Fallout Accelerated

Q2 2020 hedge fund letters, conferences and more

The Rollback Of Fuel Efficiency Standards

WASHINGTON, D.C. – One hundred days ago today, the Trump administration finalized its rollback of fuel efficiency standards — a s...



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The Technical Traders

Credit/Investments Turned Into End-User Risk Again

Courtesy of Technical Traders

Continuing our research from Part I, into what to expect in Q2 and Q3 of 2020, we’ll start by discussing our Adaptive Dynamic Learning predictive modeling system and our belief that the US stock market is rallied beyond proper expectation levels.  The Adaptive Dynamic Learning (ADL) modeling systems attempts to identify price and technical indicator DNA markers and attempts to map our these...



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Kimble Charting Solutions

Here's Why QQQ and Large Cap Tech Stocks May Rally Another 10%!

Courtesy of Chris Kimble

The long-term trend for large-cap tech stocks remains strongly in place.

And despite the steep rally out of the March lows, the index may be headed 10 percent higher.

Today’s chart highlights the $QQQ Nasdaq 100 ETF on a “monthly” basis. As you can see, the large-cap tech index touched its lower up-trend channel support in March at (1) before reversing higher.

It may now be targeting the top of the trend channel at (2), which also marks the 261.8 Fibonacci extension (based on 2000 highs and 2002 lows). That Fib level is $290 on $QQQ.

If so, this upside target for $QQQ is still 10% above current prices. Stay tuned!

This article was first written ...



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Chart School

RTT browsing latest..

Courtesy of Read the Ticker

Please review a collection of WWW browsing results. The information here is delayed by a few months, members get the most recent content.



Date Found: Saturday, 14 March 2020, 05:51:16 PM

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Comment: Crash in perspective - its Bad, and not over!



Date Found: Saturday, 14 March 2020, 07:49:29 PM

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Comment: The Blood Bath Has Begun youtu.be/bmC8k1qmM0s



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Lee's Free Thinking

These Charts Show COVID 19 Is Spreading in the US and Will Kill the Economy

 

These Charts Show COVID 19 Is Spreading in the US and Will Kill the Economy

Courtesy of  

The COVID 19 pandemic is, predictably, worsening again in much of the US. Only the Northeast, and to a lesser extent some Midwestern states, have been consistently improving. And that trend could also reverse as those states fully reopen.

The problem in the US seems to be widespread public resistance to recommended practices of social distancing and mask wearing. In countries where these practices have been practi...



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Digital Currencies

Blockchains can trace foods from farm to plate, but the industry is still behind the curve

 

Blockchains can trace foods from farm to plate, but the industry is still behind the curve

App-etising? LDprod

Courtesy of Michael Rogerson, University of Bath and Glenn Parry, University of Surrey

Food supply chains were vulnerable long before the coronavirus pandemic. Recent scandals have ranged from modern slavery ...



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Members' Corner

Coronavirus, 'Plandemic' and the seven traits of conspiratorial thinking

 

Coronavirus, 'Plandemic' and the seven traits of conspiratorial thinking

No matter the details of the plot, conspiracy theories follow common patterns of thought. Ranta Images/iStock/Getty Images Plus

Courtesy of John Cook, George Mason University; Sander van der Linden, University of Cambridge; Stephan Lewandowsky...



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Insider Scoop

Economic Data Scheduled For Friday

Courtesy of Benzinga

  • Data on nonfarm payrolls and unemployment rate for March will be released at 8:30 a.m. ET.
  • US Services Purchasing Managers' Index for March is scheduled for release at 9:45 a.m. ET.
  • The ISM's non-manufacturing index for March will be released at 10:00 a.m. ET.
  • The Baker Hughes North American rig count report for the latest week is scheduled for release at 1:00 p.m. ET.
...

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

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Mapping The Market

How IPOs Are Priced

Via Jean Luc 

Funny but probably true:

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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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