Diamond Profits

The last two days proved to provide significant movements in the diamonds allowing over 60% returns in a few hours.  Having set buy limits from the opening price of the 102 DIA PUTS and sell limits at your profit point would have executed flawlessly both Thursday and Friday.  The market likes the good news pre-market raises the futures, drives the market up within the 30-minutes opening trend and then lately as earnings are meeting or missing and revenues fall short throughout the day the market gives back all it's gains and then some.  102 PUTS could have been had at 1.75 limit and sold at 2.75 today.  This is another way to make money in today's schizo market, am I up, am I down, am I up, am I down...

I chose the Put over Call strategy because I have a short-term bearish outlook.  We'll see what next week brings with the companies on tap to provide earnings...

Happy trading.

CopSync (COYN.OB)

COYN keeps getting attention random days, today's volume was over 400K.  I added more at this level and with the news of its national sales force.  Yes it's only 3-people but this is a technology niche that just needs attention.  Given the recent events having real-time access to mulitple databases is crucial in identifying would be criminals and terrorists.  The fact that this is the communications technology keeps me interested because it could be used by anyone in the need of real-time communications utilizing current data driven systems.  I would like to see a federal agency get interested!

Happy Trading...

Berkshire added to the S&P 500 (BRK.B)

I hope you got into BRK.B recently.  Now just because it split doesn't add value to the stock but being added to the index makes it more favorable.  Up over 8% in the after hours.  This is a long term holding!

Happy Trading!

Berkshire Split

Shareholder's voting! Looking @ 65-70 entry point

Happy Trading

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Bullish on the Emerging Markets?

I was looking at some Emerging Markets ETFs this weekend and looking at how best to protect a longer-term investment in such an ETF.  I have only mentioned married puts recently on this site but the strategy is simply buy an equity and purchase a put on the same equity.  Purchasing a put gives you the right to put your shares of an equity to someone else at the strike price on the expiration month you choose.  Of course for this right you must pay a premium.  EEM and iShares ETF is trading at 41.95 as Friday.  A September $42 PUT costs $3.05 (the mid point of bid/ask)  So if I am very bullish on the emerging market and believe the ETF will rise over the next seven months to greater than $45 I will have  an extremely safe trade, only risking $3.05 a share.   Now, I like this strategy over a Stop strategy since you don't risk being "stopped out" as I did on INTC last Friday but having the same 8% protection.  Also, you can sell covered calls throughout the time period and if you do get called out you still have value in the PUT options, which could increase if the Equity/ETF starts to tank.

Well these are just ideas and I would recommend researching married puts or any other options strategy before using them in your trading...

Happy Trading.....

Learning Markets.com

For the Newbie:

 

http://www.learningmarkets.com/

 

Happy Trading!

 

Morning Update

An almost hundred point down day on decent earnings news.  LCC is up on an expiration day, maybe supporting my short-covering claim.  INTC, which I started buying, did not  buy my whole lot… yet, is down about 2% this morning.  I did follow my rules and put TStop in place but still in.  The charts show a slow run up after earnings so sticking this out and trusting the history.

 

Happy Trading!

 

Intel (INTC)

bout I should have a twitter account as I was buying Intel during the conference call.

The plan here is to do a "married put," buy some put options about 6-months out for downside protection at a cost of aroudn 1.50 a share.  This prevents getting called out, is better than a covered call since I am bullish on the price move over the short-term and locks me in to very little risk over the life of the trade.  Also, as the market trends I will sell calls on up days and buy them back on low days offsetting the cost of the put and have a risk free trade.  If I sell the equity I still have value in the put options and if INTC were to pullback significantly I would make money on the puts as well...

Looks like the base in the after hours is around 21.65, it took a quick drop to 21.39 but quickly recovered and is now consolidating here.  The historical chart shows a good run-up after earnings followed by some quick pull-backs...

Happy trading...

LCC on the move!

I would place a TRAILING STOP if you are long this one…

 

Looks like naked short covering to me!  Over 25,000 open interest on the 5$ Calls that expire Friday…  Earnings out in a couple of weeks…

 

Better safe than sorry.  This is a great stock to sell covered calls on though, the 5$ have touched .50 twice in the last couple of weeks after pulling back to .15 and .20

 

Happy Trading!

 

ARAY Put follow-up

Over the last two days Accuray has surged almost 20% driving the Mar 5 Puts down to .10 Bid and .25 ask. This would be good for at least a 50% profit if you picked up when recommended previously. I cannot find any news supporting the increase in price and volume but that doesn't mean there aren't any share exchanges or other instruments coming due or available to institutional investors or other firms.


I'm not convinced enough yet that this is pumped from such exchange so I may be looking at buying some puts for a quick pull back and then turn around and sell the 5 strike again. If we get that lucky.

Let's keep watching this one...

Happy Trading...

China Cord Blood IPO indication of CBAI.OB

China Cord Blood Corporation exercised its overallotment on 1 Jan. The IPO closed 24 Nov at $6.05.

Wouldn't it be nice if Cord Blood America closes at $6.05 someday?!

Happy Trading...

LCC Calls now earning 60% + ARAY

LCC is proving to be a good techincal covered call. I am short the Jan 5 calls and after the impact of the failed attack on Christmas Eve looks like LCC has a new base in the 4.80s. This may prove to be a well executed trade if the stock stays below 5 over the next two weeks. I was planning on using the cover to sell the stock but with this new base it may be worth hanging on to and trading out of the money calls on... 2 ways to do this; close out the option for a 60% profit and sell 6 or 7.50 calls a couple of months out or hang on to see if the options expire worthless and keep all the premium then buy the stock back on a dip for an OTM covered call.

Also looking at ARAY since it has pulled back to the 5.60 range. I recommend selling Mar 5 puts last month then the stock jumped and the premiums fell. Was looking for a .50 premium. I like ARAY for selling puts since the stock has maintained an average $5 base since I have been watching it. Even if it gets put to you just wait a week and sell it over 5...

Happy Trading...