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Free Earnings Trade of the Week: Big Lots, Inc. (BIG) – Reports Earnings Before the Markets Open 12/2/16

Big Lots, Inc. (BIG) is scheduled to report earnings before the markets open on Friday, 12/2/16.

Last quarter, the stock had the following price movement after reporting earnings:

Aug 26, 2016

54.47
54.99
50.12
50.57
4,571,200
50.36

Aug 25, 2016

53.93
55.00
51.49
52.94
3,308,700
52.72

(BIG) has never been too volatile of a stock post earnings, but it is often priced to do so. This trade, a Neutral Calendar Spread, carries minimal risk at the price to place this trade, and has extremely wide break-even points on the profit/loss chart. There are no weekly options, but not is not that much of an issue at all here. This is a very solid trade, should do very well. 9.5/10.

Here is how the trade is placed:

Entered Trade

Sell -25 BIG Dec16 50 Call

Buy 25 BIG Jan17 50 Call

Requirements

Cost/Proceeds
$1,200.00
Option Requirement
$0.00
Total Requirements
$1,200.00
Estimated Commission
$62.50

NBBO 0.35 – 0.70. Try to pay 0.53 or less for this trade. At a maximum, pay up to 0.57. See the attachment for the profit/loss chart. I will post the price to close this trade out tomorrow morning, right before the opening bell.

big-ncs-12116

Update 1: 9:20 am EST – Pre-market, the stock is up about $1.90/share. If it hangs around this range or moves down more, should be a great trade. I am placing the price to close this trade out (net credit) at 1.40 for now. I will update any changes here, as needed.

Updated Daily Options Trading Strategy (DOTS) List of Stocks Used – 11/18/16

Here is the current list of stocks used for the Daily Options Trading Strategy (DOTS), current as of 11/18/16:


Tier 1: AAPL, AMZN, BIDU, BABA, GOOGL, FB, NFLX, PCLN, TSLA

Tier 2: BA, BWLD, TWTR, EXPE, NUGT, ULTA, C, CMG, FFIV

Tier 3: SQ, CRM, HD, COST, PX, COST, FDX, STZ, UPS

Tier 4: MA, DUST, AKAM, AKS, BBY, CAT, FSLR, DIS, GPRO

If you have any questions, you can e-mail me at: kmob79@gmail.com

The Daily Options Trading Strategy (DOTS) Weekly Update & Market Volatility

It has been a very busy week so far using the Daily Options Trading Strategy (DOTS), especially on Monday. This strategy does extremely well in volatile markets. Here are the trades placed and closed out so far:


– Monday, 11/14/16. BABA at 9:35 am EST. 0.23 STC order above price paid/contract. December 90.00 calls. Paid 3.93 per contract.
– Monday, 11/14/16. FB at 9:37 am EST. 0.35 STC order above price paid/contract. December 115.00 calls. Paid 5.30 per contract.
– Monday, 11/14/16. AAPL at 9:39 am EST. 0.30 STC order above price paid/contract. December 110.00 calls. Paid 1.74 per contract.
– Monday, 11/14/16. C at 9:53 am. 0.17 STC order above price paid/contract. December 55.00 puts. paid 2.17 per contract.
– Monday, 11/14/16. GOOGL at 10:45 am EST. 1.40 STC order above price paid/contract. December 755.00 calls. Paid 19.70 per contract.
– Tuesday, 11/15/16. BA at 10:00 am EST. 0.34 STC order above price paid/contract. December 150.00 calls. Paid 2.40 per contract.
– Wednesday, 11/16/16. NUGT at 9:43 am EST. 0.20 STC order above price paid contract. December 9.00 calls. Paid 1.90 per contract.
– Wednesday, 11/16/16. TSLA at 10:15 am EST. 1.00 STC order above price paid/contract. December 180.00 calls. Paid 8.50 per contract.

To see my trade log, you can visit the link here: http://kevinmobrien.com/?page_id=480

If you are interested in my subscription service, I provide each trade on Skype and Chatzy in real time, with the ticker symbol, strike price, expiration date, and my sell-to-close price, which is the amount above what is paid for each contract. I also interact with all subscribers throughout each trading day. The subscription also includes access to my Trading Forum, where I post my earnings, weekly, and long-term trades.

I currently have reduced subscription rates and offer a one week money back guarantee if you are not happy with the service.

If you have any questions, you can e-mail me anytime at: kmob79@gmail.com.

-Kevin

Free Earnings Trade of the Week: GoPro, Inc. (GPRO) – Reports After the Markets Close On 11/3/16

GoPro, Inc. (GPRO) is scheduled to report earnings after the markets close on Thursday, 11/3/16.

Last quarter, the stock had the following price movement after reporting earnings:

Jul 28, 2016

12.15
13.28
11.75
13.02
24,145,000
13.02

Jul 27, 2016

11.47
11.83
11.42
11.57
10,651,700
11.57

The Implied Volatility on the weekly at-the-money strike price is an extremely high 401. This is very rare. Compared this number to the November 2016 at-the-money strike price of 113, which is still high, but there’s still a huge discrepancy here. If the stock make a similar move as to what it did last quarter, the trade and strategy I am using here, the Neutral Calendar Spread, will be very profitable immediately. The price is excellent to place this trade, as well, with weekly options available. 9/10.

Here is how to place this trade:

Entered Trade

Sell -75 GPRO NovWk1 12 Call

Buy 75 GPRO Nov16 12 Call

Requirements

Cost/Proceeds
$750.00
Option Requirement
$0.00
Total Requirements
$750.00
Estimated Commission
$187.50

NBBO
gpro-ncs-11316 0.06 – 0.13. Try to pay 0.10 or less for this trade. At a maximum, pay up to 0.11. See the attachment for the profit/loss chart. I will post the price to close this position out tomorrow morning right before the opening bell.

Update 1: 9:22 am EST, 11/4/16 – Pre-market, the stock is down about $2.00/share. This is close to what I expected, so I am anticipating the stock to recover off this low. I am placing the STC (net credit) at 0.30 for now, and will update any changes to this here.

Update 2, 10:07 am EST – price to close this trade out (net credit) now at 0.25.

Update 3: 10:42 am EST. Position closed at 0.27. Paid 0.12.

Free Earnings Trade of the Week: Six Flags Entertainment (SIX) – Reports Before the Markets Open 10/26/16

Six Flags Entertainment Corporation (SIX) is scheduled to report earnings before the markets open on Wednesday, 10/26/16.

Last quarter, the stock had the following price movement after reporting earnings:


Jul 27, 2016

56.16
58.30
56.00
56.69
3,912,700
56.02

Jul 26, 2016

59.22
60.00
58.85
59.46
1,378,000
58.75

This is one of those trades where the price to place it alone makes it worth trading. Last quarter, (SIX) did not make a significant move at all, and while I am expecting the stock to move more this quarter, the break-even points on the P/L chart using a Neutral Calendar Spread strategy are very wide. The only minor issue regarding this trade is the lack of weekly options. other than that, this is an excellent set-up here. I am still giving this trade a 10/10 if you are able to get the order filled at my recommended price. It will retain value regardless how it moves tomorrow once the markets open.

Here is how the trade is placed:

Entered Trade

Sell -50 SIX Nov16 50 Call

Buy 50 SIX Dec16 50 Call

Requirements

Cost/Proceeds
$1,000.00
Option Requirement
$0.00
Total Requirements
$1,000.00
Estimated Commission
$125.00

NBBO
0.00 – 0.30. Try to pay 0.20 or less for this trade. At a maximum, pay up to 0.22. See the attachment for the profit/loss chart.

I will post the price to close this trade out tomorrow morning, right before the markets open

six-ncs-102516

Update 1: 10/26/16, 9:25 am EST. – Pre-market, the stock is down $1.25/share. I am placing the price to close this trade out (net credit) at $0.50. I will update any changes here.

Update 2: 10/26/16. 10:10 am EST. This trade is in a good spot. Just need time-decay to kick in. Be patient with the trade. STC still at 0.50.

Update 3: STC *(net credit) now at 0.40

Excellent Week Trading Earnings & The Daily Options Trading Strategy (DOTS)

Is has been a great week so far both with the start of Earnings Season and the Daily Options Trading Strategy (DOTS). Here is the list of DOTS trades so far this week (10/17/16 – 10/20/16):

630. Monday, 10/17/16. AMZN at 9:41 am EST. 1.50 STC order above price paid/contract. November 815.00 calls. Group chat paid an average of 32.85 per contract.
631. Monday, 10/17/16. ULTA at 9:47 am EST. 0.60 STC order above price paid/contract. November 260.00 calls. Paid 7.60 per contract.
632. Tuesday, 10/18/16. TSLA at 1:14 pm EST. 0.70 STC order above price paid/contract. November 195.00 calls. Paid 10.30 per contract. Quick trade.
633. Tuesday, 10/18/16. TSLA at 1:20 pm EST. 2.20 STC order above price paid/contract. November 195.00 calls Paid 9.60 per contract. Used a Trailing Stop.
634. Wednesday, 10/19/16. NUGT at 10:18 am EST. 0.25 STC order above price paid/contract. November 13.00 calls. Paid 2.45 per contract.
635. Wednesday, 10/19/16. ULTA at 10:01 am EST. 0.44 STC order above price paid/contract. November 255.00 calls. Paid 6.16 per contract.
636. Thursday, 10/20/16. BIDU at 9:39 am EST. 0.55 STC order above price paid/contract. November 175.00 calls, Paid 7.75 per contract.
637. Thursday, 10/20/16. TSLA at 9:41 am EST. 0.90 STC order above price paid/contract. November 200.00 calls. Paid 8.75 per contract.
638. Thursday, 10/20/16. AAPL at 10:40 am EST. 0.30 STC order above price paid/contract. November 115.00 calls. Paid 3.90 per contract.

You can see the Daily Trade Log at the top of the page.

As far as earnings, every trade so far this week has been a winner (already closed out). I also placed 3 new Earnings trades today.

earnings-kob-oct-week-3

Next week is stacked with earnings, one of the biggest weeks really in the next few months. During slow periods today, I was preparing for a busy week next week.

I have reduced the subscription rates during the busy period during earnings season (until October 31st).

If you have any questions, please e-mail me anytime at: kmob79@gmail.com

Thanks again.

-Kevin

Free Earnings Trade of the Week: Citrix Systems, Inc. (CTXS) – Earnings Trade – After the Markets Close 10/19/16

Citrix Systems, Inc. (CTXS) is scheduled to report earnings after the markets close on Wednesday, 10/19/16.

Last quarter, the stock had the following price movement after reporting earnings:

Jul 27, 2016

85.76
88.23
85.00
87.98
4,741,600
87.98

Jul 26, 2016

88.32
89.50
88.09
89.33
3,149,600
89.33

(CTXS) has been a consistent stock in how it moves post-earnings, which is only moderate movement. This set-up looks great using a Neutral Calendar Spread strategy, which takes advantage of time-decay, a lack of a large price moves, and high Implied Volatility. the current IV on the October 2016 (this trade expires Friday) call is currently at 101, while the November strike price is at 35.68. This is ideal when using the Neutral Calendar Spread, as it shows that the options are over-priced, and this strategy is to take advantage of this.The break-even points on the P/L chart are also very wide, another important factor. I am giving this trade a solid 9/10.

Here is how this trade is placed:

Entered Trade

Sell -10 CTXS Oct16 85 Call

Buy 10 CTXS Nov16 85 Call

Requirements

Cost/Proceeds
$950.00
Option Requirement
$0.00
Total Requirements
$950.00
Estimated Commission
$25.00

NBBO 0.70 – 1.20. Try to pay 0.95 or less for this trade. At a maximum, pay up to 1.05, no more than that. I will post the price to close this trade out tomorrow right before the markets open.

See the attachment for the profit/loss chart.

ctxs-ncs-101916

UPDATE 1: 9:25 am EST 10/20/16: Pre-market, the stock is up about $3.50/share. I am placing the price to close this trade out (placed as a net credit) at $2.00. I will update any changes to this price here, if needed.

Update 2: Position closed at $1.90.

Free Earnings Trade of the Week Starts Back Tomorrow

I will be posting a free Earnings Trade of the Week starting tomorrow and will post at least one trade per week here on the website. I will try to post each trade by 11:45 am EST but no later than 2:00 pm EST (depending on the stock/pricing, etc.). There are a lot of companies reporting tomorrow after the markets close, so will definitely have at least few trades to place. Yesterday’s Strangle on Netflix (NFLX), which I mentioned in an earlier post this morning, netted a 150% return on the call side, which I sold already. I still have the put side with one month of time-value.

My trading style is to close out profitable trades as soon as possible, and that was a great trade at a good price to pay at $3.10. I thought when initially looking at different strike prices that it would cost more than that. The pricing of options, and especially on the Straddle/Strangle strategy, are critical to their success.

If you have any questions about options, you can e-mail me at: kmob79@gmail.com

Thanks.

CBOE’s Useful IVolatility Tool – Website Link

One tool I like to use with stock options, especially on Straddle or Strangle trades, but also long-term trades, is the Chicago Board Options Exchange IVolatility options calculator/pricer. The link is here: www.cboe.com/framed/IVolframed.aspx?content=http%3a%2f%2fcboe.ivolatility.com%2fcalc%2findex.j%3fcontract%3dC44A90FE-8D3F-4F26-A1EA-AAB6AB7CB180&sectionName=SEC_TRADING_TOOLS&title=CBOE%20-%20IVolatility%20Services.

This calculator allows trader’s to put in a ticker symbol and choose their own parameters, such as the strike price, expiration date, current volatility percentage, and the current share price in relation to the strike price. One this information is added in, the calculator will then compute all of the parameters and show the estimated (very accurate) price for both the call and put options. This is especially handy for new option traders, but also very useful for options that have a longer expiration date and time-value left.

I am frequently asked how do I know what a good price to place the sell-to-close order should be on strategies such as the Straddle/Strangle, which has both call and put options placed simultaneously, a neutral-based strategy.

Yesterday, 10/17/16, I placed a Strangle on Netflix (NFLX), using November $115.00 strike price calls and November $85.00 put options. The stock was trading at $100.00/share at the time of placement and fill. I paid $3.10 to place this trade. Since there is about a month of time-value left on both legs of the strategy, I do not want to sell either side of the trade too low. Pre-market on Tuesday, the stock is up about $18.50 a share, so I have a general idea of what the call side will be trading at just based on experience and the intrinsic value alone, but the put side may also still have some value, especially should there be a pull back on the stock.

One important thing: after earnings, the Implied Volatility of a given security will drop. This is because the news is already out as to the results post-earnings and the uncertainty is mostly removed as to what direction the stock will move. When using the IVolatility calculator, as a general rule, I like to lower the volatility percentage about 20 points. So if the chart on the calculator had a volatility percentage of 58 pre-earnings, use 38 when you input the new information. This may be too much, or too little, but it will give you a good idea as to the average drop of volatility. I do this pre-market.

On earnings trades, you can always use trailing stops if you think the trade will keep gaining in value in relation to how the stock is moving.

If you have any questions, you can e-mail me at: kmob79@gmail.com

Earnings Season Starts This Week – Will Be a Busy Few Weeks Trading

With Alcoa (AA) and the big bank stocks reporting earnings this week (C), (JPM), (WFC), the next month will be full of earnings trades. I use trading strategies that take a neutral approach towards earnings. These include the Strangle, the Reverse Iron Condor, and the Neutral Calendar Spread.

There are still a couple of days left for the reduced subscription rates + match plan that I am offering.

If you have any questions about options or the strategies mentioned above, please e-mail me at: kmob79@gmail.com

Thanks.

-Kevin

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