Double Diagonal

How to Play Google (GOOG) Earnings

By | Butterfly spread, Earnings, Iron Condor, Iron Fly, OP Newsletter, Option Trading, Option Trading Strategy, Trade Ideas | No Comments

How to play Google (GOOG) earnings and how to benefit from Implied volatility crush post google earnings is on the minds on almost every option traders I have met or spoken to. But before I proceed further let me share that earnings are usually 50/50 at best i.e. in-spite of complete detailed research you may still end-up being wrong. The chances of win are 50%. If you go with that assumption and are willing to take increased risks for potential windfalls, Google (GOOG) Certainly offers great opportunities for option traders. I have been covering Google earnings for almost 4 years. I also provided 4 different…

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OPNewsletter Jul 2010 Up +8.3%

By | Butterfly spread, Calendar spread, Double Diagonal, Iron Condor, OP Newsletter, Option Trading, Option Trading Strategy, Past Performance, US Market | No Comments

We are on track for our 28th positive month of OPNewsletter phase-2, as of last Friday close OPNewsletter Jul 2010 portfolio is up +8.3% on the maximum investment of almost 60% of portfolio capital. We have started opening Aug 2010 portfolios and our first portfolio is already positive. Let’s talk consistency first, especially on trades like Iron condor which is probably the most widely used option trading strategy. OPNewsletter has lost only 1 month of RUT iron condor since May 2008, and the drawdown was only 7.15% while gains have been around 12% on average per month. RUT Iron Condor for…

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OPNewsletter May +18%, June +5.3% (Open)

By | OP Newsletter, Past Performance, US Market, Worldwide Markets | 2 Comments

Another turbulent and volatile period! Last week started with a huge gap up rally after EU announced a $1trillion bailout package but by weekend it was a different story. Now there are questions on how solid it was. The confidence barometer, Euro, is now 4 years low and maybe even headed for $ parity as I wonder if EU will really step in to avoid Euro slide.  They should be pretty excited as EU economy may get much needed push with a weaker Euro. For OPNewsletter, we are 77% in cash. Remainder of the cash is invested across 3 income…

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OPNewsletter April +9.7% (closed); May +12% (Open)

By | OP Newsletter, Past Performance | No Comments

While markets are struggling to make any meaningful advance, for OPNewsletter, we are having another excellent month. We closed April’10 portfolios for +9.7% gains, and for May income portfolios, we are up +12% with 3 weeks to go. These results don’t include gains on speculative trades. Another point to note, these were also two months when I significantly upped investments allocation. In April’10 we invested 88% of capital and this month we invested 75% of capital. If one considers compounding effect, these income trades resulted in +18% gains on overall capital in just two expiration cycle alone (still 3wks to…

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A Straddle Strangle Swap on Berkshire

By | Investment Strategy, Option Trading, Option Trading Strategy, Options Essentials, Trade Ideas, US Market | 10 Comments

This post will explain what’s a Straddle Strangle Swaps option trading strategy? And also share a trade idea on how to use this strategy on Berkshire Hathaway (BRK.B) to make some money while learning it as well. A Straddle Strangle Swaps (SSS) is the sale of a front-month Straddle and the purchase of a back-month Strangle. From the pictorial perspective, it looks like a simple Calendar Spread. (For beginners who are wondering what is a Straddle and Strangle- A straddle is long 1 call and long 1 put at the same strike price and expiration and on the same stock….

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RIMM- A Speculative Play

By | Earnings, Option Trading, Option Trading Strategy, Past Performance, Trade Ideas | 5 Comments

RIMM is going to announce earnings Thursday after market close. It will be followed by Options Expiration on Friday. The IVs will drop significantly post earning announcements. What to expect from earnings; Here is from RIMM Research In Motion: Expect strong Q1, with gross margin bounce and follow-on catalysts for Q2 outlook – Caris (77.35 -2.94) Caris notes that RIMM reports Q1 results tomorrow and firm is comfortable with the aggressive ests they raised to back in early May, namely revs $3.50 bln and EPS $0.98 (consensus $3.43 bln/$0.94), driven by 8.2 mln handheld units vs. 7.5-8.0 mln guide,…

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