Conservative Options Trades

Discussion in 'Journals' started by danshirley, Aug 21, 2011.



  1. He is just posting ideas. For more info read the first 6 posts (posts #61 to #66) on page 7 of this thread: Selling Naked Options



    :)
     
    #1021     Jul 25, 2015
  2. WPZ:

    http://www.thestreet.com/story/1323...d-by-fundamentals.html?puc=yahoo&cm_ven=YAHOO

    http://realmoney.thestreet.com/arti...damentals?_ga=1.37526567.602116145.1438053771

    http://finance.yahoo.com/echarts?s=WPZ+Interactive#{"range":"5y","allowChartStacking":true}

    http://www.msn.com/en-us/money/stockdetails/fi-126.1.WPZ.NYS?symbol=WPZ&form=PRFIEQ

    http://www.wallstreetdaily.com/2015/07/14/pipeline-merger-williams-companies/

    Williams Partners L.P. is a subsidiary of Williams Companies, Inc.

    Trade:
    with WPZ at 45.63
    sell March $40 put for a net credit of $235
    Yield = 235/3765 = 6.34% in 235 days or 9.7% annualized
    Prob = 63%

    Price............... Profit / Loss......... ROM %
    30.00................... (765.00).......... -19.13%
    35.19................... (246.10)........... -6.15%
    37.65........................ 0.00............. 0.00%
    40.00..................... 235.00............ 6.34%
    40.65..................... 235.00............ 6.34%
    46.11..................... 235.00............ 6.34%
    51.58..................... 235.00............ 6.34%

    I will make this trade with the intent of buying WPZ at $40
    WPZ currently yields 7.6%

    If I don't want to buy WPZ and I want to limit the downside:

    March 40/35 bull put spread for a net credit of $40
    Yield = 40/460 = 8.7% in 235 days or 13.5% annualized
    Prob = 63%

    Price ..................Profit / Loss........... ROM %
    26.25..................... (460.00).............. -92.00%
    32.16..................... (460.00).............. -92.00%
    35.00..................... (460.00).............. -92.00%
    38.38..................... (122.20).............. -24.44%
    39.60.......................... 0.00.................. 0.00%
    40.00........................ 40.00.................. 8.70%
    44.60........................ 40.00.................. 8.70%
    50.82........................ 40.00.................. 8.70%
    57.04........................ 40.00.................. 8.70%

    Note: it may be well to wait for the coming interest rate increase before doing this trade.
     
    Last edited: Jul 28, 2015
    #1022     Jul 27, 2015
  3. DOW:

    http://www.forbes.com/sites/narrativescience/2015/07/21/dow-chemical-earnings-projected-to-increase/

    http://www.streetinsider.com/Earnings/Dow+Chemical+(DOW)+Tops+Q2+EPS+by+8c/10744488.html

    http://finance.yahoo.com/news/3-cheap-stocks-buy-now-211009465.html

    http://www.msn.com/en-us/money/stockdetails/fi-126.1.DOW.NYS?symbol=DOW&form=PRFIEQ

    http://finance.yahoo.com/echarts?s=DOW+Interactive#{"range":"5y","allowChartStacking":true}

    Trade:
    with DOW at 45.63
    Jan 35/30 bull put spread for a net credit of $51
    Yield = 51/449 = 11.4% in 171 days or 24% annualized
    Prob = 89%

    Price............. Profit / Loss........... ROM %
    20.00................ (449.00).............. -89.80%
    25.00................ (449.00).............. -89.80%
    30.00................ (449.00).............. -89.80%
    34.49..................... 0.00.................. 0.00%
    35.00.................... 51.00................ 11.40%
    37.00.................... 51.00................ 11.40%
    40.00.................... 51.00................ 11.40%
    50.00.................... 51.00................ 11.40%
    57.00.................... 51.00................ 11.40%
     
    #1023     Jul 28, 2015
  4. DOW looks to have good expectancy:

    probability finishing above 35.0: 0.90
    probability finishing below 30.0: 0.02
    probability between: 0.08
    0.90(51) - 0.02(449) - 0.08(224) = 17.31
     
    #1024     Jul 28, 2015
  5. GSK:

    http://finance.yahoo.com/news/glaxosmithkline-q2-beats-despite-advair-111044885.html

    http://finance.yahoo.com/news/drugmaker-gsk-sees-earnings-growth-123006668.html

    http://finance.yahoo.com/news/glaxo-gsk-beats-q2-earnings-123712680.html

    http://healthland.time.com/2012/07/05/breaking-down-glaxosmithklines-billion-dollar-wrongdoing/

    http://finance.yahoo.com/video/4-stocks-4-trades-gilead-162700096.html

    http://finance.yahoo.com/news/glaxosmithkline-beats-profit-forecasts-despite-113423912.html

    http://www.msn.com/en-us/money/stockdetails/fi-126.1.GSK.NYS?symbol=GSK&form=PRFIEQ

    http://finance.yahoo.com/echarts?s=GSK+Interactive#{"range":"2y","allowChartStacking":true}

    Trade:
    With GSK at 42.62
    Jan 40/37 bull put spread for a net credit of $55
    Yield = 55/245 = 22.4% in 169 days or 48% annualized
    Prob = 66%
    Expectation = .66(55) - .17(245) - .17(123) = 36.3 - 42.6 - 20.9 = -27.2

    Price.................. Profit / Loss............. ROM %
    27.00..................... (245.00)................ -81.67%
    32.00..................... (245.00)................ -81.67%
    37.00..................... (245.00)................ -81.67%
    37.81..................... (164.50)............... -54.83%
    39.45.......................... 0.00................... 0.00%
    40.00......................... 55.00................. 22.43%
    42.96......................... 55.00................. 22.43%
    45.00......................... 55.00................. 22.43%
    50.00......................... 55.00................. 22.43%
     
    #1025     Jul 30, 2015
  6. CLX:

    http://finance.yahoo.com/news/clorox-jumps-cleaning-4th-quarter-171349850.html

    http://www.msn.com/en-us/money/stockdetails/fi-126.1.CLX.NYS?symbol=CLX&form=PRFIEQ

    http://stockcharts.com/h-sc/ui?s=clx

    Trade:
    With CLX at 114.83
    Jan 100/95 bull call spread for a net credit of $25
    Yield = 25/475 = 5.3% in 165 days or 11.6% annualized
    Prob = 90%
    Expectation = .9(25) - .04(475) -.06(238) =22.5 - 19.0 - 14.3 = -11

    Price............. Profit / Loss............. ROM %
    70.00................ (475.00).............. -95.00%
    85.00................ (475.00).............. -95.00%
    95.00................ (475.00).............. -95.00%
    99.62.................. (13.10)............... -2.62%
    99.75..................... 0.00.................. 0.00%
    100.00.................. 25.00.................. 5.30%
    115.00.................. 25.00.................. 5.30%
    125.00.................. 25.00.................. 5.30%
    150.00.................. 25.00.................. 5.30%
     
    #1026     Aug 3, 2015
  7. XOM:
    http://finance.yahoo.com/news/tumbling-oil-prices-slam-profit-153251221.html

    http://finance.yahoo.com/video/brent-falls-below-50-first-012019872.html

    http://www.msn.com/en-us/money/stockdetails/fi-126.1.XOM.NYS?symbol=XOM&form=PRFIEQ

    http://stockcharts.com/h-sc/ui?s=uso

    http://stockcharts.com/h-sc/ui?s=xom

    Trade:
    with XOM at 78.06
    Jan 90/95 bear call spread for a net credit of $30
    Yield = 30/470 = 6.4% in 165 days or 14% annualized
    Prob = 86%
    Expectation = .86(30) - .075(470) - .06(235) = 25.8 - 35.3 - 14.1 = -24

    Price............. Profit / Loss............. ROM %
    60.00................... 30.00................... 6.40%
    70.00................... 30.00................... 6.40%
    80.00................... 30.00................... 6.40%
    90.00................... 30.00................... 6.40%
    90.30..................... 0.00................... 0.00%
    94.42................ (412.50)............... -82.50%
    95.00................ (470.00)............... -94.00%
    100.00.............. (470.00)............... -94.00%
    120.00.............. (470.00)............... -94.00%
     
    Last edited: Aug 3, 2015
    #1027     Aug 3, 2015
  8. GMCR:

    http://www.bloomberg.com/news/artic...ts-forecast-after-pod-demand-slows?cmpid=yhoo

    http://finance.yahoo.com/news/keurig-plunges-3q-sales-says-205925659.html

    http://www.msn.com/en-us/money/stockdetails/fi-126.1.GMCR.NAS?symbol=GMCR&form=PRFIEQ

    http://finance.yahoo.com/echarts?s=GMCR+Interactive#{"range":"5y","allowChartStacking":true}

    Trade:
    With GMCR at 74.98
    Jan 95/100 bear call spread for a net credit of $60
    Yield = 60/440 = 13.6% in 163 days or 31% annualized
    Prob = 80%
    Expectation = .8(60) - .16(440) - .04(220) = 108 - 70.4 - 8.8 = 28.8

    Price.................. Profit / Loss............... ROM %
    55.00....................... 60.00.................... 13.60%
    65.00....................... 60.00.................... 13.60%
    75.00........................60.00.....................13.60%
    85.00....................... 60.00.................... 13.60%
    95.00....................... 60.00.................... 13.60%
    95.60......................... 0.00..................... 0.00%
    97.22..................... (161.60)................ -32.32%
    100.00................... (440.00)................ -88.00%
    110.00................... (440.00)................ -88.00%
    125.00................... (440.00)................ -88.00%

    Alternate trade:
    With GMCR at 74.98
    Jan 75/70 bear put spread for a net debit of $283
    Yield = 217/500 = 43% in 163 days or 97% annualized
    Prob = 51%

    Price................. Profit / Loss............ ROI %
    55.00................... 217.00................. 76.68%
    65.00................... 217.00................. 76.68%
    68.00................... 217.00................. 76.68%
    70.00.................. 217.00.................. 76.68%
    72.17..................... 0.00.................... 0.00%
    75.00................. (283.00).............. -100.00%
    80.00................. (283.00).............. -100.00%
    85.00................. (283.00).............. -100.00%
    95.00................. (283.00).............. -100.00%
     
    Last edited: Aug 5, 2015
    #1028     Aug 5, 2015
  9. NWN:
    http://www.msn.com/en-us/money/stockdetails/fi-126.1.NWN.NYS?symbol=NWN&form=PRFIEQ

    http://finance.yahoo.com/echarts?s=NWN&t=2y&l=off&z=l&q=l&c=#{"range":"5y","allowChartStacking":true}

    Trade:
    with NWN at 43.78
    DEC 40/35 bull put spread for a net credit of $35
    Yield = 35/465 = 7.5% in 133 days or 21% annualized
    Prob = 78%
    Expectation = .78(35) - .025(465) - .195(232) = 27.3 - 11.6 - 45.2 = -29.5

    Price................. Profit / Loss........ ROM %
    25.00.................. (465.00).............. -93.00%
    30.00.................. (465.00).............. -93.00%
    35.00.................. (465.00).............. -93.00%
    37.47.................. (218.30).............. -43.66%
    39.65...................... 0.00................... 0.00%
    40.00..................... 35.00.................. 7.50%
    45.00..................... 35.00.................. 7.50%
    50.00..................... 35.00.................. 7.50%
    55.00..................... 35.00.................. 7.50%
     
    #1029     Aug 7, 2015
  10. TSLA:

    http://www.nasdaq.com/article/tesla-key-takeaways-from-earnings-cm506780

    http://www.nasdaq.com/article/tesla...-as-investors-question-its-ambitions-cm506083

    http://www.reuters.com/article/2015/08/09/us-teslamotors-cash-insight-idUSKCN0QE0DC20150809

    http://www.msn.com/en-us/money/stockdetails/fi-126.1.TSLA.NAS?symbol=TSLA&form=PRFIEQ

    http://finance.yahoo.com/echarts?s=TSLA+Interactive#{"range":"5y","allowChartStacking":true}

    Trade:
    With TSLA at 242.51
    Jan 300/305 bear call spread for a net credit of $65
    Yield = 65/435 = 14.9% in 159 days or 34% annualized
    Prob = 83%
    Expectation = .83(65) - .16(435) - .01(217) = 53.9 - 69.6 - 2.3 = -18

    Price.................. Profit / Loss............. ROM %
    181.88................... 65.00.................... 14.90%
    220.14................... 65.00.................... 14.90%
    260.42................... 65.00.................... 14.90%
    300.00................... 65.00.................... 14.90%
    300.65.................... 0.00....................... 0.00%
    300.70................... (4.70).................... -0.94%
    305.00................... (435.00)................ -85.10%
    340.97................... (435.00)................ -85.10%
    381.25................... (435.00)................ -85.10%
     
    #1030     Aug 9, 2015