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Free Trade of the Week: Harley-Davidson, Inc. (HOG) – Earnings Trade – Before the markets open 7/22/14

Harley-Davidson, Inc. (HOG) is scheduled to report earnings before the markets open on Tuesday, July 22, 2014.

This stock has always been a consistent winner for earnings trades.For whatever reason, the option strike prices are inflated, always expecting a large price move. While last quarter that did somewhat happen, it is very unusual for this stock to do so. This is an excellent stock for the Neutral Calendar Spread. Here are their last 4 quarters of movement after reporting earnings:

Apr 22, 2014 72.51 73.50 71.35 71.87 5,835,700 71.59
Apr 21, 2014 65.97 67.69 65.97 67.54 1,458,700 67.28

Jan 30, 2014 66.31 66.69 62.21 63.19 2,822,000 62.68
Jan 29, 2014 64.10 65.05 63.74 64.04 2,142,200 63.52

Oct 22, 2013 66.07 66.49 63.76 64.71 2,475,000 63.99
Oct 21, 2013 66.00 66.04 65.08 65.57 1,921,200 64.84

Jul 25, 2013 57.47 59.52 55.57 55.74 3,183,600 54.93
Jul 24, 2013 56.11 56.40 55.40 55.86 1,506,700 55.05

I am giving this trade a 9/10. The only negative is that is could be a little less expensive, was looking for around 0.50.

Here is how the trade is placed:

Entered Trade

Sell -25 HOG Aug14 67.5 Call
Buy 25 HOG Sep14 67.5 Call

Requirements

Cost/Proceeds $1,525.00
Option Requirement $0.00
Total Requirements $1,525.00
Estimated Commission $75.00

Greeks / NBBO

Symbol Bid Ask IV Delta Gamma Vega Theta
HOG Aug14
67.5 Call 1.91 2.02 30.39 -1,224.58 -186.82 -175.10 108.54
HOG Sep14
67.5 Call 2.46 2.68 26.21 1,224.04 140.43 270.13 -61.05
Net -0.54 -46.39 95.03 47.49

NBBO 0.44 0.77. Try to pay 0.61 or less for this trade. At a maximum, pay 0.64.

HOG NCS 72214

Updated Daily Options Trading Strategy Lists – 6/8/14

Tier 1 :

Apple (AAPL), CF Industries (CF), Baidu (BIDU), Google (GOOGL), Tesla Motors (TSLA), LinkedIn (LNKD), Amazon.com (AMZN), Netflix (NFLX), Priceline Group (PCLN)

Tier 2:

Keurig Green Mountain (GMCR), International Business Machines (IBM), F5 Networks (FFIV) , Polaris Industries (PII), Twitter (TWTR), SanDisk (SNDK), Wynn Resorts (WYNN),  Facebook (FB), Goldman Sachs (GS),

Tier 3

Caterpillar (CAT),  FedEx Corp. (FDX), Charter Communications (CHTR), Monsanto (MON), PVH Corp (PVH), Wynn Resorts (WYNN), Visa (V), Boeing (BA), Cummins Inc. (CMI)

Tier 4:

Yelp (YELP), Lockheed Martin (LMT), Fossil (FOSL),  Zillow (Z), Citigroup (C), United Parcel Service (UPS), Precision Castparts (PCP), Ralph Lauren (RL), Salesforce.com (CRM)

Free Earnings Trade of the Week: SINA Corporation (SINA) – After the markets close 5/21/14

SINA Corporation (SINA) – Earnings Trade- After the markets close 5/21/14

SINA Corporation (SINA) is scheduled to report earnings after the markets close on Wednesday, May 21, 2014.

Since its last earnings release, the stock has really nose-dived. Here is how the stock moved last quarter:

Feb 25, 2014 72.50 72.79 68.14 68.98 9,447,700 68.98
Feb 24, 2014 77.75 78.49 74.60 76.08 6,368,400 76.08

The 52-week range is very wide, at $45.69 – $92.83. I am expecting this stock to either tank or move up a lot tomorrow, and I will be placing a Strangle with June expirations. 9/10. Here is how the trade is placed:

Entered Trade

Buy 10 SINA Jun14 50 Call
Buy 10 SINA Jun14 45 Put

Requirements

Cost/Proceeds $3,100.00
Option Requirement $0.00
Total Requirements $3,100.00
Estimated Commission $30.00

Greeks / NBBO

Symbol Bid Ask IV Delta Gamma Vega Theta
SINA Jun14
50 Call 1.41 1.46 47.36 356.02 58.29 50.30 -40.12
SINA Jun14
45 Put 1.62 1.69 49.00 -345.45 55.73 49.75 -40.14
Net 10.57 114.02 100.05 -80.26

NBBO
3.03 3.15. Try to pay 3.10 or less for this trade, but you can go up to 3.30 if it gets late and your order isn’t filled.

Free Trade of the Week- Whole Foods (WFM) – Earnings Trade- After the markets close 5/6/14

Whole Foods (WFM) – Earnings Trade- After the markets close 5/6/14

Whole Foods Market, Inc. (WFM) is scheduled to report earnings after the markets close on Tuesday, May 6, 2014.

WFM is a stock that is fairly consistent making a $3.00+ price move over the years after reporting earnings. Last quarter the stock had the following price movement:

Feb 13, 2014 51.71 51.92 50.32 51.46 25,871,200 51.34
Feb 12, 2014 56.15 56.42 55.22 55.46 9,463,800 55.33

I believe thee right way to trade this stock for earnings is using a Reverse Iron Condor. A Strangle is too expensive, and generally, the stock doesn’t move that much to warrant that type of trade. A NCS allows little room for any movement, so that is definitely off the table. This is a solid trade, not providing a great ROI, but still very good. 8/10.

Here is how the trade is placed:

Entered Trade

Buy 10 WFM MayWk2 47 Put
Sell -10 WFM MayWk2 46 Put
Buy 10 WFM MayWk2 50 Call
Sell -10 WFM MayWk2 51 Call

Requirements

Cost/Proceeds $610.00
Option Requirement $0.00
Total Requirements $610.00
Estimated Commission $60.00

Greeks / NBBO

Symbol Bid Ask IV Delta Gamma Vega Theta
WFM MayWk2
47 Put 0.99 1.04 90.12 -361.14 95.07 16.37 -245.39
WFM MayWk2
46 Put 0.66 0.70 90.56 268.88 -83.35 -14.43 217.35
WFM MayWk2
50 Call 0.81 0.83 86.73 338.96 96.48 16.01 -231.78
WFM MayWk2
51 Call 0.54 0.57 87.00 -253.01 -84.06 -13.99 203.12
Net -6.31 24.14 3.96 -56.70

NBBO 0.53 0.67. Try to pay 0.60 or less for this trade, and a maximum of 0.62. See the attachment for the profit/loss chart.

WFM RIC 5614

Akamai Technologies, Inc. (AKAM) – Earnings Trade- After the Markets Close 5/1/14

Akamai Technologies, Inc. (AKAM – Earnings Trade- After the Markets Close 5/1/14

Akamai Technologies, Inc. (AKAM) is scheduled to report earnings after the markets close on Thursday, May 1, 2014.This stock is one of the most volatile after reporting. Last quarter, the stock had the following price movement after reporting, and this wasn’t a one-time event:Feb 6, 2014 54.99 57.76 54.80 57.18 14,583,100 57.18
Feb 5, 2014 46.43 47.79 46.20 47.42 5,598,500 47.42

Looking at the strike prices, I feel they are very reasonably priced, especially if there is anywhere near the movement of the last few quarters.

What I really like about this trade is that while it is at a Strangle price, it is more like a Straddle, and that we can buy the June 2014 expirations at not much more cost than the May 2014′s. This is a must-trade, and should do very well.

Here is how the trade is placed:

Entered Trade

Buy 10 AKAM Jun14 55 Call
Buy 10 AKAM Jun14 52.5 Put

Requirements

Cost/Proceeds $5,360.00
Option Requirement $0.00
Total Requirements $5,360.00
Estimated Commission $30.00

Greeks / NBBO

Symbol Bid Ask IV Delta Gamma Vega Theta
AKAM Jun14
55 Call 2.72 2.81 39.87 484.00 50.01 79.68 -32.41
AKAM Jun14
52.5 Put 2.49 2.59 41.71 -393.72 46.14 76.90 -31.42
Net 90.28 96.15 156.58 -63.83

NBBO 5.21 5.40. Try to pay 30 or less, and a maximum of 5.50. Try to get in this trade early.

Netflix, Inc. (NFLX) – Free Earnings Trade of the Week – After the markets close 4/21/14

RE: Netflix, Inc. (NFLX) – Earnings Trade – After the markets close 4/21/14

I accidentally had the NFLX NCS trade calculator up at the same time as the Strangle, and posted the NCS which I don’t like at all but always look at. The trade is a RIC. This is how the trade is placed, my apologies.

Entered Trade

Buy 5 NFLX May14 400 Call $5.75 $2,875.00
Buy 5 NFLX May14 280 Put $3.70 $1,850.00

Requirements
Cost/Proceeds $4,725.00
Option Requirement $0.00
Total Requirements $4,725.00
Estimated Commission $15.00

Greeks / NBBO

Symbol Bid Ask IV Delta Gamma Vega Theta
NFLX May14
400 Call 5.60 5.75 60.59 100.07 2.56 126.62 -154.30
NFLX May14
280 Put 3.60 3.75 70.96 -54.91 1.46 84.88 -119.89
Net 45.16 4.02 211.50 -274.19
NBBO 9.20 9.50

Trading Seminars in San Diego, CA – See Details Below

San Diego, CA Seminars (Two 3-Day Events) – September 2014 (dates announced soon)

*maximum limit of 200 people/per event (see requirements to attend below)

 

Choose from two events, The Daily Options Trading Strategy – June (DOTS) and/or

How to Trade Debit Spreads Using Stock Options

 

  • Both include LIVE TRADING, with my recommendations for you in real-time.
  • All questions are encouraged and answer
  • Explanation of my daily strategy and using Bollinger Bands properly
  • Meet other traders using the same strategies
  • You will make money during the seminars
  • Catered Breakfast and Lunch is included each day

 

Pricing:

 

  1. The Daily Options Trading Strategy(DOTS) is $2500.00/per person
  2. How to Trade Debit Spreads Using Stock Options is $2000.00/per person
  3. If you would like to attend both Seminars, the price is reduced to $3500.00/per person for both live trading seminars.

 

Requirements:

 

  • You must have at least a Level 3 trading account with your online broker.
  • Since the threshold to day-trade using options is $25,000.00, I would prefer all traders have $75,000.00 to work with during the 3 days, as there will be multiple trades during the seminar.
  • A basic understanding of stock options and my daily strategy. This is not only a teaching course, but also trading, so trades happen fast, and it is essential that you can enter and exit these trades as quickly as possible.

 

Please contact me with any questions you may have at: kmob79@gmail.com

Free Trade of the Week: Big Lots Inc. (BIG) – Earnings Trade- Before the markets open 3/7/14

Big Lots Inc. (BIG) – Earnings Trade- Before the markets open 3/7/14

Big Lots Inc. (BIG) is scheduled to report earnings before the markets open on Friday, March 7, 2014.

This is a good stock to use for the Neutral Calendar Spread. It is not volatile, yet the options are always priced for a big move, ideal for the NCS strategy.

Last quarter, the stock moves more than usual, so this quarter the at-the-money strikes are extremely overpriced. This should be a very good trade and it priced great. 8/10.

Here is how the trade is placed:

Entered Trade

Sell -20 BIG Mar14 27.5 Call
Buy 20 BIG Apr14 27.5 Call

Requirements

Cost/Proceeds $500.00
Option Requirement $0.00
Total Requirements $500.00
Estimated Commission $60.00

Greeks / NBBO

Symbol Bid Ask IV Delta Gamma Vega Theta
BIG Mar14
27.5 Call 2.55 2.70 71.73 -1,371.10 -167.31 -42.00 101.36
BIG Apr14
27.5 Call 2.80 2.95 48.98 1,342.74 147.39 72.42 -42.16
Net -28.36 -19.92 30.42 59.20

NBBO 0.10 0.40. Try to pay 0.25 or less for this trade. At a maximum, pay 0.30. See the attachment for the profit/loss chart.

BIG NCS 3714

Think or Swim (TOS) Users can set-up the RSI and charts for the Daily Options Trading Strategy (DOTS)

Here is how:

I finally figured out how to create the OptionsExpress RSI in ThinkOrSwim, *and* I wrote something that will place an “up” or “down” arrow on the chart when all of your metrics line up.

I know you don’t use it, but for your users that do and ask about it – the script below is what I call “RSI_OX”

I’ll create a video later to show how to create this script in thinkorswim, but for now here is the code in case any of your users
are wondering how to get around thinkorswim’s “RSIWilder” function: (also this is preset with the “KMO values” for RSI (12,70,30)
instead of the normal 14,70,30 hehehehe – enjoy!

I implemented the formula given by Schwab here:
http://help.sspro.schwab.com/4.18/Chart_Studies.htm
(search for Relative Strength Index)
I think there is a off by one error in the script I just sent here is the new one (since the current price needs to be tacked on separately too:

#
# Relative Strength Index v2 – by Rex Lew (c my a**) 2014
#

declare lower;
input length = 12;
input over_Bought = 70;
input over_Sold = 30;
input price = close;
def UpSum = If((price – price[1]) > 0,price – price[1], 0) + Sum( If(price > price[1],price – price[1],0), length);
def UpDiv = If(price > 0,1,0) + Sum( If(price > price[1],1,0), length);
def DownSum = If((price – price[1]) < 0,price[1] – price, 0) + Sum( If(price < price[1],price[1] – price,0), length);
def DownDiv = If(price < 0,1,0) + Sum( If(price < price[1],1,0), length);

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