Conservative Options Trades

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

  1. #211     Jul 16, 2012
  2. he guys, don't piss him off, i like this tread to continue
     
    #212     Jul 16, 2012
  3. QCOM:

    http://www.forbes.com/sites/greatsp...s-supply-chain-on-way-to-68/?partner=yahootix

    http://finance.yahoo.com/news/qualcomm-expand-supplier-203514565.html

    http://wallstcheatsheet.com/stocks/qualcomm-third-quarter-earnings-sneak-peek.html/?ref=YF

    http://finance.yahoo.com/q/ks?s=QCOM+Key+Statistics

    http://investing.money.msn.com/investments/financial-statements?symbol=QCOM

    http://blogs.barrons.com/techtrader...ce-say-lazard-credit-suisse/?mod=yahoobarrons

    http://finance.yahoo.com/q/bc?s=QCOM&t=5y&l=on&z=l&q=l&c=

    QCOM is the largest of the 'fabless' semiconductor mfg's. There have been articles with rumors that QCOM will use its large cash position to start its own fabrication plant. This would be bad for the QCOM stock but I don't think it will happen. Even if they start their own Fab it will not insure against supply problems.

    Trade:

    Jan '13 40/35 put spread for a net credit of $35
    Yield = 35/465 = 7.5% in 186 days or 14.8% annualzed
    Prob = 91%
    Expectation = .91(35) - .02(465) - .07(232) = 31.8 - 9.3 - 16.2 = 6.3

    Note:
    We are starting to spend a lot of time argueing with trolls etc.

    This is partly my own fault as I have violated my basic rule of putting all posters (except myself) on ignore and even if I happen to see troll posts because I happen by when I am not logged on I should not respond to them. As everyone knows responding to trolls will wreck your thread.

    It is beyond my expertise to speculate on why there are trolls and what motivates them... it is best to just ignore them.

    Therefore I will reinforce my no-reply policy and ignore even the most reasonable questions from non-trolls because it is impossible to predict who is a troll and who is not.

    If you want to get the most out of this thread I recommend you put the trolls on ignore also.

    :)
     
    #213     Jul 16, 2012
  4. YHOO:

    http://finance.yahoo.com/news/yahoo-profit-dips-slightly-mayer-000230175.html

    http://finance.yahoo.com/news/yahoo-names-marissa-mayer-ceo-143209682.html

    http://finance.yahoo.com/q/ks?s=YHOO+Key+Statistics

    http://investing.money.msn.com/investments/financial-statements?symbol=yhoo

    http://finance.yahoo.com/q/bc?s=YHOO&t=5y&l=on&z=l&q=l&c=

    http://finance.yahoo.com/q/bc?s=YHOO+Basic+Chart

    http://finance.yahoo.com/q/bc?s=YHOO&t=5d&l=on&z=l&q=l&c=

    Trade:

    Jan 12.5/10 bull put spread for $25
    Yield = 25/225 = 11.1% in 175 days or 23% annualized
    Prob = 85%
    Expectation = .85(25) - .02(225) - .13(112) = 21.25 - 4.5 - 14.56 = 2.19
    (the expectation is not really different from zero... the 'expected expectation' for appropriately priced options)
     
    #215     Jul 17, 2012
  5. VVUS:


    http://finance.yahoo.com/news/highly-anticipated-weight-loss-pill-040512455.html

    http://finance.yahoo.com/q/ks?s=VVUS+Key+Statistics

    http://finance.yahoo.com/q/bc?s=VVUS&t=5y&l=on&z=l&q=l&c=

    http://seekingalpha.com/article/727761-vivus-gets-fda-approval-for-obesity-pill-qsymia?source=yahoo

    http://ir.vivus.com/

    " FDA recommends that women of childbearing age test negative for pregnancy before starting the drug and take a monthly pregnancy test while taking it. "

    Jan 10/7.5 bull put spread for a net credit of $30
    Yield = 30/220 = 13.6% in 184 days or 27% annualized
    Prob= NA
    Expectation = NA

    VVUS is a 'development stage' pharmaceutical company. Which means it has little in the way of assets (compared to for example Bristol Myers or Merck ) other than drug patents and uses contractors for manufacturing. It also means that the company is losing money.

    The main ambition of such a company is to get a drug approval from the FDA and then either sell the patent or sell the company.

    I used to own a business which made a living selling contract services to a whole group of such development stage pharmaceutical companies in northern NJ clustered around Princeton, in Mass. clustered around Boston and in Calif. clustered around San Diego.
     
    #216     Jul 18, 2012
  6. UGI:

    http://finance.yahoo.com/q/pr?s=UGI+Profile

    http://finance.yahoo.com/q/ks?s=UGI+Key+Statistics

    http://investing.money.msn.com/investments/financial-statements?symbol=ugi

    http://finance.yahoo.com/q/bc?t=5y&s=UGI&l=off&z=l&q=l&c=&ql=1&c=^GSPC

    http://finance.yahoo.com/q/bc?t=5y&s=UGI&l=off&z=l&q=l&c=&ql=1

    Trade:

    Jan 25/20 bull put spread for a net credit of $55
    Yield = 55/445 = 12.4% in 184 days or 24% annualized
    Prob = 94%
    Expectation = .94(55) - .01(445) - .05(223) = 51.7 - 4.45 - 11.2 = 36.05
     
    #217     Jul 18, 2012
  7. #220     Jul 20, 2012