BIDU earnings

Discussion in 'Options' started by scriabinop23, Feb 14, 2007.

  1. candeo

    candeo

    Gangof4,

    If you expected a big move in BIDU, why not sell a horizontal spread instead of buying a straddle?
    Buy Mar 115, sell June 115, for a credit of $5.20.
    This way you still make money from IV crush.
    Scriabinop, looks like it would have been a good trade even for you, as it should still make some money at $115 if I am right, and risk would have been very low.
     
    #21     Feb 14, 2007
  2. Yahoo finance says BIDU conference call is at 8pm EST tonight. Anything can happen tomorrow.
     
    #22     Feb 14, 2007

  3. LOL it s $102 now.
     
    #23     Feb 15, 2007
  4. candeo

    candeo

    BIDU is going to open around $102. Would be interesting to know how you guys both did and how bad the volatility crush was. I would like to compare results with selling a calendar spread.
     
    #24     Feb 15, 2007
  5. Sticking to the dream plan now.. covering the calls ... then hope for either an extreme move down (remember i hedged with extra strangles) or a move back to 115 to cover the puts.
     
    #25     Feb 15, 2007
  6. candeo

    candeo

    It would be great if you could post P/L of whole position at opening, so we can double-check yesterday's projections.
     
    #26     Feb 15, 2007
  7. I also sold 120 mar/bot 120 feb. that made me 1k. That spread works much better on a drop than up (i netted breakeven on ntri).

    I am in maximum loss right now, $250/spread (did 25).

    Keeping the hedges on, and hoping for a return up.
     
    #27     Feb 15, 2007
  8. by way .. plan here to divert pin risk if I don't get beneficial move today: switch half short puts for long Mar 105 calls.
     
    #28     Feb 15, 2007
  9. candeo

    candeo

    Thanks for sharing. Will analyze all this later today. I am up $1,200 on the 20 spread on NTRI (Mar/June). Does not look like IV dropped that much. It is now 55% on the Mar's and 48% on the Jun's. Yesterday it was 65% and 54%.
    The Feb's $45 were 119% and now 83%.
     
    #29     Feb 15, 2007
  10. i know i see. my feb/mar spreads were profitable and my Mar/Jun 50s were no good.

    They either need to be VERY in the money on the upside, or do better easily in a stock drop.

    Nice tool, though.

    But it looks like the Feb/Mar doesn't suffer too much from the theta decline so close to expiration. Good to know. I did 10 45/45s and 2 50/50s.
     
    #30     Feb 15, 2007