Top Trades for Wed, 07 Nov 2018 11:41 – UGA

Recount in Florida!

Well, $1.65 on /RB is a little crazy.  In the STP, let's add:

  • Buy 30 UGA Jan $28 calls for $2.00 ($6,000) 
  • Sell 30 UGA Jan $31 calls for 0.80 ($2,400)

That's net $3,600 on the $9,000 spread and figure we'll cut and run at $1,800 so risking that to make up to $5,400 if all goes well.

Big picture the move was $25 to $37.50 so 50% move up and that means, unless we're making new lows, that $27.50 should be good support (weak bounce of a full retrace) and $30 really should be bouncy (strong bounce) so this is a good spot to give the longs a shot. 

Top Trades for Wed, 31 Oct 2018 15:09 – IBM and GE

Webinar/Ravi – None that worked so far!  Went long on /RB at $1.76 (4 contracts) and short on /ES at 2,724.50 (2 contracts) and our IBM play was:

  • Sell 5 2021 $120 puts for $20 ($10,000) 
  • Buy 15 2021 $120 calls for $11.30 ($16,950) 
  • Sell 15 2021 $145 calls for $5 ($7,500) 

That's a net $550 credit on the $37,500 spread so $38,050 upside potential (6,918%) if IBM is over $145 in Jan 2021.  

Also, on GE:

  • Buy 5,000 shares of GE for $10 ($50,000) 
  • Sell 50 2021 $10 calls for $2.85 ($14,250)
  • Sell 50 2021 $12 puts for $3.15 ($15,750) 

That's net $20,000 or $4/share and, if assigned another set at $12, the average would be $8 on 10,000 shares – so that's your downside but, if called away over $12, you get $50,000  for a 150% gain.  

AAPL/QC – I hope they miss so we can buy a lot more but no opinion as to whether or not they'll look good enough to hold $2.20 ($1.1Tn) in this environment.

AAPL up 3% today, huge boost for Dow, Nas and S&P:

Top Trades for Thu, 25 Oct 2018 11:47 – IP

MU/Soma, Batman - Well, at $36, the 2021 $33 puts can be sold for $6.10 so say $3,050 for 5 short and then you can buy 10 of the 2021 $25 ($16)/38 ($9.50) bull call spreads for $6.50 ($6,500) and that's net $3,450 on the $13,000 spreads that's pretty much in the money.  It's conservative but still pays $9,550 (276%) at $38.

IMAX/Jabob – I don't know what people expect from these guys.  

Imax (IMAX) came out with quarterly earnings of $0.14 per share, beating the Zacks Consensus Estimate of $0.11 per share. This compares to earnings of $0.08 per share a year ago. These figures are adjusted for non-recurring items.

This quarterly report represents an earnings surprise of 27.27%. A quarter ago, it was expected that this entertainment technology company would post earnings of $0.25 per share when it actually produced earnings of $0.30, delivering a surprise of 20%.

Over the last four quarters, the company has surpassed consensus EPS estimates three times.

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Top Trades for Tue, 23 Oct 2018 22:45 – 3 Trades for Money Talk

Money Talk Notes:

Segment 1:

Increasing volatility coming into the election is "normal" as is a correction after such a huge rally, which has been fueled by corporate buybacks and tax cuts that have distorted the true profits of US Corporations and the true demand for stocks in general.


Segment 2:  The Money Talk Portfolio 

The Money Talk Portfolio had its one-year anniversary on September 6th and we only include trades and changes that we announce live on the show and don't touch it in-between so it's the ultimate low-touch portfolio, as we come on about once each quarter. 

We started with $50,000 and now, after a year and a month, we're at $95,645 for a gain of $45,645 (91.3%) so far.  

  • ALK – A short put we are confident in, should gain another $3,275 at maturity.  
  • SQQQ – A good hedge that's $6,760 in the money but only showing net $3,450 out of a $10,000 potential.  Hopefully we lose the $3,450 because the market does well as it's simply insurance and not a bet.  
  • ABX – A long-term bet on gold that pays up to $12,500 and is currently on track at net $2,225 so good for a new trade with another $10,275 (460%) left to gain at $15.  

  • GE – Been in everyone's dog house but I like them long-term.  If they recover, could be a $15,000 net at $18 but we'll be happy with $6,000 at $15 and the current net is just $2,020 so call it $3,980 (197%) at $15 as a realistic goal.
  • GIS – A newish trade still good for a new entry with a potential return of $11,250 and currently net $2,315 so $8,935 (385%) more if all goes well.  
  • LB – Another sleeper but our goal is a modest $35 though we'll have to roll the 20 Jan $32.50 puts at $4.50 ($9,000) to 12 2021 $30 puts at $7.50 ($9,000).  At $35, this trade pays $30,000 and is currently trading at net $1,700 so a nice $28,300 (1,665%) at $35 would be great! 
  • WPM

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Top Trades for Mon, 15 Oct 2018 10:22 – MU

MU/Albo – Yes, it's in the LTP as a recent add and still playable:

Long Call 2020 17-JAN 40.00 CALL [MU @ $41.89 $-0.58] 20 8/17/2018 (459) $26,000 $13.00 $-3.53 $13.00     $9.48 $-0.13 $-7,050 -27.1% $18,950
Short Call 2020 17-JAN 55.00 CALL [MU @ $41.89 $-0.58] -20 8/17/2018 (459) $-10,000 $5.00 $-0.75     $4.25 $-0.20 $1,500 15.0% $-8,500
Short Put 2020 17-JAN 42.00 PUT [MU @ $41.89 $-0.58] -15 8/17/2018 (459) $-7,500 $5.00 $2.00     $7.00 $0.10 $-3,000 -40.0% $-10,500

Of course now we'll want to adjust it and 2021s are out so we'll probably roll the 2020 $40s at $9.50 ($19,000) to the 2021 $35s at $15 ($30,000) picking up $10,000 of intrinsic value plus a year for $11,000.  The short Jan $55s are still $4, so no way I'd buy them back and the short $42 puts are $7 and the 2020 $38 puts are $7 but still plenty of one-year premium in the 2020 puts, so no reason to change those either.  

As a new trade for the OOP, I want to take advantage of the short 2020 $55s at $4.50 so:

  • Sell 10 2020 $55 calls for $4.50 ($4,500) 
  • Buy 20 2021 $45 ($11)/$60 ($6.50) bull call spreads at $4.50 ($9,000) 
  • Sell 10 2020 $35 puts for $5.50 ($5,500) 

So we're starting this trade with a $1,000 credit and you have $31,000 upside potential if all goes well.  If MU goes higher, you're well-covered and can begin buying back short calls.  At $45, let's say they gain all $3 of the move and you buy back 3 for $7.50 – that's just $2,250 so you're in for $1,250 net and now triple-covered on the longs.  At $50 you buy back 3 more for $12.50 and that's $3,750 and you'd be then in the $30,000 spread for $5,000 with 4 short calls left against you.  

So the upside case is just fine and flat is fine and down is fine because you have a credit and the worst case is you have to roll the puts but, if you don't REALLY want to own MU for net $34 – why would you be in this trade in the first place?

Oh no, things are turning very ugly, Nas down 100 with AAPL down $4 (1.7%).  

Top Trades for Wed, 10 Oct 2018 16:05 – PYX

PYX is getting into pot and up and down like crazy but what I really like about them for the LTP is:

  • Buy 25 PYX 2021 $15 calls for $30 ($75,000) 
  • Sell 25 PYX 2021 $55 calls for $20 ($50,000) 
  • Sell 5 PYX Nov $50 calls for $7 ($3,500) 

So the net is $21,500 and we are selling just 37 out of 828 days and it's a 1/5 sale so we have 20 of those ahead of us for a potential $70,000 return on our $21,500 investment PLUS up to $100,000 back on the spread if we're over $55.  I love this trade!  

Top Trades for Mon, 08 Oct 2018 13:21 – DAL

DAL/Dave – Rising fuel prices, rising labor costs, backlash against fees and seat sizes – all headwinds for the airlines next year but DAL is a great operator at $36Bn ($52), dropping $3.6Bn to the bottom line even after paying normal amounts of taxes last year ($2.1Bn on $5.7Bn earned) so that's 10x earnings BUT it's the same $40Bn they grossed in 2014, when they only made $659M, so very wild swings in the bottom line over time but I'd consider 2014 more a one-time thing.

Year End 31st Dec 2012 2013 2014 2015 2016 2017 TTM 2018E 2019E

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Top Trades for Wed, 26 Sep 2018 11:21 – 9 Trade Ideas!

Adding some holiday income (and hedges) for Q4 with a set that you can start a whole new portfolio with:  

In the LTP, we have BBBY:

Short Put 2020 17-JAN 17.50 PUT [BBBY @ $19.09 $0.19] -20 1/8/2018 (478) $-5,600 $2.80 $-0.14 $-2.20     $2.67 $-0.18 $270 4.8% $-5,330
Long Call 2020 17-JAN 15.00 CALL [BBBY @ $19.09 

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Top Trades for Wed, 19 Sep 2018 10:37 – MJ

MJ (ETF) owns some TLRY – not sure at what price but I bet it's not priced into them yet.

The investment seeks to provide investment results that, before fees and expenses, correspond generally to the total return performance of the Prime Alternative Harvest Index. The fund will invest at least 80% of its total assets, exclusive of collateral held from securities lending, in the component securities of the index and in ADRs and GDRs based on the component securities in the index. The index is concentrated in the Pharmaceuticals and Tobacco industries and tracks the performance of the exchange-listed common stock (or corresponding ADRs or GDRs) of companies across the globe. The fund is non-diversified.


Top 10 Holdings (57.46% of Total Assets)

Get Quotes for Top Holdings

Name Symbol % Assets
Canopy Growth Corp WEED.TO 10.72%
Cronos Group Inc CRON.TO

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Top Trades for Thu, 06 Sep 2018 15:08 – SDS Hedge

Very interesting that Tech can't catch a break lately.  MU and other chips getting hit hard.  We'll see what AVGO says later.

Hedge/Gard – To hedge $1M of SPY positions, I'd go with an SDS hedge.  He'd be looking to offset a $200,000 loss and SDS is at $34 so +20% (a 10% S&P drop on the 2x inverse ETF) is $42 and the March $34 ($2.60)/$40 ($1.50) bull call spread is $1.10 and pays $6 in a big drop so let's say he wants to offset $60,000 worth of damage – he can do that for $11,000 and that's the cost of insurance.  

I'd pair that with some short puts on stocks he'd REALLY like to own if they get cheap, like 10 MU 2020 $42 puts at $6.40 ($6,400) which drops the net cost to $4,600 on the $60,000 spread, giving it $55,400 (1,200%) profit potential if SDS is over $40.  



Zero Hedge

Visualizing China's Belt And Road Investment Map

Courtesy of ZeroHedge. View original post here.

The fifth anniversary of China’s Belt and Road Initiative (BRI) was recently marked in Beijing.

This 900 billion U.S. dollar transcontinental development project was launched in the autumn of 2013 when president Xi Jinping proposed the building of the Silk Road Economic Belt and the 21st Century Maritime Silk Road – the two main segments of the ambitious economic cooperation campaign. ...

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Phil's Favorites

Data deficit means we're in the dark about the digital divide


Data deficit means we're in the dark about the digital divide

Cellphones are everywhere in Africa - but that doesn’t mean the digital divide is closing. Legnan Koula/EPA

Courtesy of Alison Gillwald, University of Cape Town

Digital concerns underpin many of the UN’s Sustainable Development Goals. Gender equality, good health, quality education, industry innovation, smart and sustainable cities: these all require strong information and communications technology systems to become a reality.

For all of this to happen, developing countries will have to overcome the &ld...

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Kimble Charting Solutions

Party Like 1999 & 2000 or respect bearish divergences?

Courtesy of Chris Kimble.


This 4-pack looks at the DJ Home Construction, Banks, Junk Bonds and the S&P 500, highlighting that bearish divergences took place in 1999 and 2007 at each (1). These assets were sending bearish topping messages “BEFORE” the tops in 2000 & 2007.

Looking at this year, each asset has been creating bearish divergence since early 2018 at each (2).

Are each of these assets sending an important Risk/Reward message again or will it be different this time?

Just the Facts Ma’am– The majority of stock indices remain above respectiv...

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Insider Scoop

28 Stocks Moving In Tuesday's Pre-Market Session

Courtesy of Benzinga.

  • Globus Maritime Limited (NASDAQ: GLBS) rose 34.9 percent to $10.59 in pre-market trading following Q3 results. Globus Maritime reported third-quarter earnings of 0.08 per share, up from $(0.05) in the same quarter of last year. Sales came in at $4.861 million, up from $3.982 million year-over-year.
  • Avenue Therapeutics, Inc. (NASDAQ: ATXI) shares rose 33.4 percent to $5.55 in pre-market trading after InvaGen announced plans to acquire 33.3 percent stake in Avenue Therapeutics, a Fortress Biotech company.
  • Pyxis Tankers Inc.... more from Insider

Members' Corner



This is a three-part Opinion Video Series from NY Times about Russia’s meddling in the United States’ elections as part of its "decades-long campaign to tear the West apart." This is not fake news. Read more about the series here.



By Adam B. Ellick and Adam Westbrook



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Chart School

Weekly Market Recap Nov 11, 2018

Courtesy of Blain.

This past week was saw another positive move up by bulls – especially in the Dow and S&P 500; the NASDAQ was not quite as enthusiastic.   Wednesday’s rally was on the legs of an election that was seen as market friendly or at least not as bad as it could have been.   Essentially – paying people a lot of money to get nothing done the next 2 years – woo hoo!

The market is interpreting Wedneday’s result as insuring that “no big things will get done,” in Washington between now and 2020, Craig Birk, chief investment officer at Personal Capital told MarketWatch. “The market appreciates the relative certainty of the slow legislative agenda.” he said.

“As President Trump plans his 2020 reelection campaign, a gridlocked Congress is unlik...

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Digital Currencies

Bitcoin's high energy consumption is a concern - but it may be a price worth paying


Bitcoin's high energy consumption is a concern – but it may be a price worth paying


Courtesy of Steven Huckle, University of Sussex

Bitcoin recently turned ten years old. In that time, it has proved revolutionary because it ignores the need for modern money’s institutions to verify payments. Instead, Bitcoin relies on cryptographic techniques to prove identity and authenticity.

However, the price to pay for all of this innovation is a high carbon footprint, created by Bitc...

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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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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/

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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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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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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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.

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