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Free Earnings Trade of the Week: Activision Blizzard, Inc. (ATVI) – Reports After the Markets Close 2/9/17

Activision Blizzard, Inc. (ATVI) is scheduled to report earnings after the markets close on Thursday, 2/9/17.

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


Nov 03, 2016

42.96
43.67
42.63
43.37
43.37
12,822,700

Nov 02, 2016

42.63
43.09
42.26
42.60
42.60
7,792,900

The current Implied Volatility on the weekly at-the-money strike price is at 175, which is extremely high. The at-the-money March 2017 strike price is at 36, so there is a major difference. The Neutral Calendar Spread is the strategy to use here. Everything looks good about it: weekly options, price to place the trade, wide break-even points, break-even points, and the high IV on the weekly at-the-money strike price. 9.5/10, trade of the week.

Here is how the trade is placed:

Entered Trade

Sell -20 ATVI FebWk2 40 Call

Buy 20 ATVI Mar17 40 Call

Requirements

Cost/Proceeds
$720.00
Option Requirement
$0.00
Total Requirements
$720.00
Estimated Commission
$50.00

NBBO -0.29 – 0.43. Try to pay 0.37 or less for this trade. at a maximum, pay up to 0.38. See the attachment for the profit/loss chart. I will post the price to close this trade out right before the markets open tomorrow.

Update #1: 9:20 am EST – Pre-market, the stock is up about $4.70/share, but do expect the share price to fall. I am placing the price to close this trade out at $0.60 (net credit). I will update any changes here throughout the day.

Update #2: STC (net credit) now at 0.50.

Discounted Subscription Rates + Match Plan (February 6, 2017 – February 13, 2017)

I am offering reduced subscription rates for one full week, from February 6, 2017 – February 13/ 2017, and also will match any subscription plan that is three (3) months or longer.

Here are the following discounted subscription rates:

One (1) Month Subscription – $129.00
Three (3) Month Subscription – $299.00 + Match
Six (6) Month Subscription – $449.00 + Match
One Year Subscription – $699.00 + Match
Lifetime Subscription – $999.00

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

Very Volatile Trading Day on Monday, 1/30/17 – Daily Options Trading Strategy (DOTS)

For about a week ahead of the Presidential Inauguration trading was much slower than usual, as was last week. I am always extra careful trading around any event, but especially this one. There was a surprising lack of volatility, and you can’t trade what isn’t there, so it required some patience to spot trades that did come up.

I do expect very volatile markets going forward, however, and there are many reasons for this. This is great for the Daily Options Trading Strategy (DOTS), which is a strategy that takes advantage of highly oversold and overbought securities with the anticipation of exiting the trade a soon as possible.

Today, on Monday 1/30/17, the markets opened down (still are), and there were trading opportunities right after the markets opened, all calls. This had to be taken advantage of using my strategy. You can see these trades and all others on the top of my homepage (Daily Trade Log) that had some really great returns in an extremely short amount of time. Here is the link: http://kevinmobrien.com/?page_id=480

If you have any questions about the strategy or stock options in general, you can e-mail me anytime at: kmob79@gmail.com

Thanks.

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

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.

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 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

Daily Options Trading Strategy (DOTS) – Updates List of Stocks Used – Current as of 9/6/16

Here is the current list of stocks used with the Daily Options Trading Strategy (DOTS) as of September 6, 2016:

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

Tier 2: BA, BWLD, TWTR, CMG, IBM, FDX, HD, C, FIT

Tier 3: EXPE, COST, SQ, PYPL, DPZ, CRM, DIS, UPS, ULTA

Tier 4: PNRA, PII, INTU, GPRO, FFIV, PX, V, NUGT, AVGO

I separate each group of stocks used into groups of 9, using a grid view. This makes it easier to navigate different tabs and follow each stock without having to close out any tabs or leave any page.

If you have any questions, you can contact me at kmob79@gmail.com.

Thanks.

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