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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);

Free Earnings Trade of the Week: Brocade Communications (BRCD) – Reports after the markets close on Thursday, February 13, 2014

Brocade Inc. (BRCD) – Earnings Trade – After the markets close 2/13/14

Brocade Communications Systems, Inc. (BRCD) is scheduled to report earnings after the markets close on Thursday, February 13, 2014.

Last quarter, the stock had the following price movement:

Nov 19, 2013 8.30 8.91 8.21 8.77 15,343,300 8.77
Nov 18, 2013 8.12 8.16 8.06 8.10 7,146,800 8.10

and the quarter before…

Aug 14, 2013 7.86 8.04 7.64 7.99 32,485,000 7.99
Aug 13, 2013 6.91 6.94 6.80 6.90 7,393,300 6.90

I am going to place a Strangle on this trade, using March 2014 expirations. Not an expensive trade to place, and the stock is usually good for at least a 12% price move. 7/10. Here is how to place the trade:

Entered Trade

Buy 10 BRCD Mar14 10 Call
Buy 10 BRCD Mar14 9 Put

Requirements

Cost/Proceeds $590.00
Option Requirement $0.00
Total Requirements $590.00
Estimated Commission $30.00

Greeks / NBBO

Symbol Bid Ask IV Delta Gamma Vega Theta
BRCD Mar14
10 Call 0.24 0.25 42.01 325.57 292.62 10.55 -6.23
BRCD Mar14
9 Put 0.33 0.36 43.30 -366.95 296.79 11.03 -6.53
Net -41.38 589.41 21.58 -12.76

NBBO 0.57 0.61. Try to pay 0.59 or less for this trade.

Daily Options Trading Strategy (DOTS) Updated List: Current as of 2/9/14

Daily Options Trading Strategy (DOTS) – Updated List/Tiers

Tier 1:

Apple (AAPL)

Baidu (BIDU)

CF Industries (CF)

Amazon.com (AMZN)

Google (GOOG)

LinkedIn (LNKD)

Netflix (NFLX)

Priceline.com (PCLN)

Tesla Motors (TSLA)

 

Tier 2:

Facebook (FB)

Green Mountain Coffee Roasters (GMCR)

Twitter (TWTR)

Wynn Resorts (WYNN)

Sina Corp. (SINA)

Yelp (YELP)

F5 networks (FFIV)

VMware (VMW)

Chipotle Mexican Grill (CMG)

 

Tier 3:

Zillow (Z)

Fossil Group (FOSL)

Visa (V)

Buffalo Wild Wings (BWLD)

AthenaHealth (ATHN)

Intuitive Surgical (ISRG)

Mastercard (MA)

Ralph Lauren (RL)

Ulta Salon (ULTA)

Tier 4:

Citigroup (C )

Pandora (P)

Expedia (EXPE)

TripAdvisor (TRIP)

Las Vegas Sands (LVS)

Lululemon (LULU)

International Business Machines (IBM)

Salesforce.com (CRM)

SanDisk (SNDK)

 

Free Trade of the Week: Ralph Lauren Corp. (RL) – Earnings Trade- Before the markets open 2/5/14

Ralph Lauren Corp, (RL) – Earnings Trade- Before the markets open 2/5/14

Ralph Lauren Corporation (RL) is scheduled to report earnings before the markets open on Wednesday, February 5, 2014.

The stock has had the following price movement the last two quarters after reporting earnings:

Nov 6, 2013 180.00 180.78 176.81 180.52 3,249,500 180.06
Nov 5, 2013 169.71 173.32 169.61 171.19 1,961,700 170.75

Aug 7, 2013 177.06 180.76 172.01 173.13 3,092,900 172.27
Aug 6, 2013 187.36 189.80 186.01 189.51 881,400 188.56

This trade is similar to the Estee Lauder trade I posted earlier, and it is also priced reasonable well. There are very good break-even points on this one, as well. The Neutral Calendar Spread will be used again here. The stock has a major tendency to move a lot pre-market, then settle down and move up/down only modestly, which is when I plan to close it out tomorrow. A solid trade, 8/10.

Here is how the trade is placed:

Entered Trade

Sell -10 RL Feb14 155 Call
Buy 10 RL Mar14 155 Call

Requirements

Cost/Proceeds $700.00
Option Requirement $0.00
Total Requirements $700.00
Estimated Commission $30.00

Greeks / NBBO

Symbol Bid Ask IV Delta Gamma Vega Theta
RL Feb14
155 Call 6.70 7.20 52.78 -518.40 -22.61 -133.08 208.61
RL Mar14
155 Call 7.60 7.90 35.88 523.64 20.43 216.37 -88.26
Net 5.24 -2.18 83.29 120.35

NBBO 0.40 1.20. Try to pay 0.80 or less for this trade. At a maximum, pay 0.90.

See the attachment for the profit/loss chart.RL NCS 2514

Free Trade of the Week – VMware (VMW) – Reports after the markets close on Tuesday, 1/28/2013

VMware, Inc. (VMW) is scheduled to report earnings after the markets close on Tuesday, January 28, 2014.

Anytime a company pre-announces earnings ahead of schedule http://biz.yahoo.com/e/140123/vmw8-k.html, this is usually a great time to buy a Neutral Calendar Spread, especially when the Implied Volatility is still expecting a large price move (currently at 77 vs. February’s 36). As of now, there is a $7.00 price moved expected based on at-the money strike prices. I am expecting about half that, so this should be a quick double.

I will be placing a Neutral Calendar Spread. Here is how it is placed:

Entered Trade

Sell -10 VMW JanWk5 95 Call
Buy 10 VMW Feb14 95 Call

Requirements

Cost/Proceeds $950.00
Option Requirement $0.00
Total Requirements $950.00
Estimated Commission $30.00

Greeks / NBBO

Symbol Bid Ask IV Delta Gamma Vega Theta
VMW JanWk5
95 Call 2.55 2.75 75.79 -518.49 -61.01 -34.35 435.15
VMW Feb14
95 Call 3.50 3.70 36.29 524.57 45.01 97.07 -74.66
Net 6.08 -16.00 62.72 360.49

NBBO 0.75 1.15. Try to pay 0.95 for this trade or less. At a maximum, pay 1.05.

VMW NCS 12814

Free Trade of the Week: Darden Restaurants, Inc. (DRI) – Earnings Trade- Reports before the markets open 12/19/13

Darden Restaurants, Inc. (DRI) – Earnings Trade- Before the markets open 12/19/13 DRI NCS 121913

Darden Restaurants, Inc. (DRI) is scheduled to report earnings before the markets open on Thursday, December 19, 2013.

Last quarter, the stock did very little at the open from the previous days close. It did drop a decent amount at one point, but nothing too significant. I am expecting the same this time. This stock has always had overpriced options before they report earnings trades, and a Neutral calendar Spread takes advantage of those. The Implied Volatility on the expiring December 2013 strike price (expires this Friday) is almost 3X that of the January 2014 strike price. Last quarter , the stock had the following price movement:

Sep 20, 2013 47.47 47.83 45.72 45.78 6,344,400 45.23
Sep 19, 2013 49.78 49.80 48.92 49.30 1,851,100 48.71

This trade is also extremely inexpensive to place. It should profit immediately. A solid 9/10 trade, with an excellent ROI %. Here is how the trade is placed:

Entered Trade

Sell -20 DRI Dec13 52.5 Call
Buy 20 DRI Jan14 52.5 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
DRI Dec13
52.5 Call 1.45 1.55 95.34 -1,035.95 -214.99 -31.00 740.22
DRI Jan14
52.5 Call 1.70 1.80 33.14 961.69 161.35 118.77 -66.88
Net -74.26 -53.64 87.77 673.34

NBBO 0.15 0.35. Try to pay 0.25 or less for this trade, and up to 0.30 to ensure you get in. See the attachment for the profit/loss chart.

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