MARY4MONEY
806 posts
msg #81782
- Ignore MARY4MONEY |
10/26/2009 6:19:36 PM
what you do is play an out of the money strangle--here is how you know its going to be a good move so you can make some serious money-- on the 1-2 trrading periods before the earnings annoucement- you want to do the following--1. have the trading volume>1.5x 2. have the option trading be more than 2x- which it was on amzn and bidu- i bought 8 million$ worth of the 330-390 puts last friday also- but if you were going to play a single strangle-- on bidu you buy the 350 put and 510 call last friday for a total 4.30$-- on amzn you wanted to buy either the 110c and 70 p or the 120 c and 60p(this would of cost you <0.40- and you could of sold it today for 8.80$)-
|
Kevin_in_GA
4,599 posts
msg #81783
- Ignore Kevin_in_GA
modified |
10/26/2009 6:38:45 PM
The Nov $510 call is about to take a beating based on the AH stock move for BIDU (down 13%). Better hope that the 350 put moves like a rocket to cover your loss on the call.
BIDU is down 52 dollars to $378 in AH trading.
I blew it today - my strategy was to sell the call BEFORE earnings, and I would have made my target 20% today (I bought the Nov 500 call at 3.90 on Friday, and it went past 4.70 before closing today at 4.20), but I got greedy and figured I'd hold it until the earnings news came out.
Bad call.
|
karennma
8,057 posts
msg #81803
- Ignore karennma
modified |
10/26/2009 10:37:20 PM
Man!
I WISH AAPL would drop $50 so I could make money on the AAPL puts I'm still holding.
I did an AAPL strangle (bought calls AND puts) last week and didn't make crap.
Kevin, don't feel bad about your BIDU calls. In fact, the beauty of options is, you've LIMITED your risk up front.
I hope you didn't buy 10+ contracts.
If you only bought one ... just to "get your feet wet", you're in good shape.
I mean really!
WHO the H*LL would EVER expect a $50 drop!!!????
On Friday, when I checked the open interest, there were a lot more calls than puts.
:>)
|
karennma
8,057 posts
msg #81806
- Ignore karennma |
10/26/2009 10:48:44 PM
BIDU
Open interest calls Nov 360's to 550's = 20,327
Open interest puts Nov 330's to 460's = 13,873
|
karennma
8,057 posts
msg #81808
- Ignore karennma |
10/26/2009 11:04:54 PM
Last week, I DID pose the question as to whether BIDU could DROP.
See my last 2 posts.
Here
|
karennma
8,057 posts
msg #81812
- Ignore karennma |
10/26/2009 11:37:28 PM
From Trading Signals ...
"Baidu on Monday forecast revenue in the fourth quarter to range between $174 million and $180 million, below the average analyst estimate of $204.7 million, according to Thomson Reuters I/B/E/S.Revenue in the three months ended September 30 totaled $187.3 million, a tad below the average analyst estimate of $189 million but higher than the 135.4 million a year-earlier.Third-quarter net income rose to $72.2 million, or $2.07 a share, from $51.2 million, or $1.47 a share, in the same period last year."
|
MARY4MONEY
806 posts
msg #81820
- Ignore MARY4MONEY
modified |
10/27/2009 8:17:50 AM
kevin i will lose most of my money on the calls- but i on the puts-- bidu is at 360 now- so that will make my 360 puts that i paid2 .00 for worth near 25$ now- so its looking like the puts will gain me 800-900%- so i will end up with say 700% or 50-60 million dollars for the puts and my toal cost is about 15.8 million- you just have to make sure the stock will make a nice move either way- say at least 12-25%-here is what i paid for them-- 330-0.50 340 0.80 350-1.20 360-2.00 370-2.80 380 4.30 390-6.22
|
karennma
8,057 posts
msg #81827
- Ignore karennma |
10/27/2009 10:09:54 AM
MARY4MONEY
- MARY4MONEY
10/27/2009 8:17:50 AM
- you just have to make sure the stock will make a nice move either way- say at least 12-25%-
======================================================================================
How would we know that AHEAD of time?
I think you'd have to restrict your bets to the "four horsemen" ...
AAPL, BIDU, RIMM, AMZN
What other stocks have made a $20+ move after earnings?
|
MARY4MONEY
806 posts
msg #81830
- Ignore MARY4MONEY |
10/27/2009 10:17:35 AM
while bidu at <357 i got 2200 contracts of the 400-460 calls
|
karennma
8,057 posts
msg #81838
- Ignore karennma |
10/27/2009 11:56:22 AM
M4M:
I looked at those when BIDU dropped.
That's a good play.
|