OP Income Newsletter Sept portfolios are track to deliver a record month with +19.2% gains (as of Aug 31 close) excluding gains from OPNExtra! which is a FREE feature for OPN members that includes directional as well as earning trades. Some of the members asked me what will the results if we had allocated $1000 for each portfolio? The results would have been +29% vs +19.2%. You may choose whichever method you like, I shall still encourage to use my suggested allocation….
Those which are still open– SPY up +21%, KR is up +2.1%, GOOG is down -2.1%, UVXY is up +5.7%,
And trades that are closed– DIA up +15.2%, NTAP for +19.6%, CRM closed for +23.2%, IWM +19.3%, DG for +27.5% and JOY for +8.5%
And now more important, I have “SELL” signal triggered as of Friday close. If you are an OPN Member, pls stay in touch with two threads 1) General market comments, 2) OPN Extra trades!
We have great time ahead, volatilities are low and as we move to the most crucial 3months of the year, specific set-of opportunities are arising. If you are still on sidelines and have missed past several weeks’ action, sign-up for OPNewsletter now. There is no waiting list currently and OPIncome Newsletter subscription is open to all. Should you have any questions or need any clarification, please send me an e-mail-> OptionPundit@gmail.com
OP Income Newsletter July portfolios delivered +4.6%; and August 2012 Income portfolios are up +10% and we still have a few more weeks to go. These results exclude gains from OPNExtra which is a FREE feature for OPN members that includes directional as well as earning trades.
OptionPundit Income Newsletter
The key difference between “OP Income Trades” and “OPN Extra!” is the capital allocation. OPN Income newsletter uses majority of the portfolio capital and is employed for non-directional income trading strategies for example Iron Condor Spread, Calendar Spread, Diagonal spread, Credit and debit spreads, etc. OPN Extra uses a small fraction of capital of trade set-ups based on earnings, momentum, swing trades, unusual M&A, support and resistance etc.
Unless your trade is structured based on prudent capital allocation even a few losses can wipe out whole portfolio. So at OptionPundit, overall focus is to preserve and grow capital via Income Trading Strategies and use OPNExtra! as accelerator opportunistically. And since primary focus is on Income, the OPN performance excludes gains from OPNExtra even though these are nicely accretive to overall portfolio performance.
Here are the results from OPNExtra! (Trade details– For Member’s only)
Earnings-
While Bidu and LVS are still open, here are the results from other symbols-> INFY +175%, WYNN +18% and +24%, GOOG +19% and +54%, CMG +225%, PNRA -50%, CHRW +12%, TXN +10%, AAPL +63.6%, IDCC -26%, CROX +6% and WFM +178%. We still have many more weeks left for earnings to come.
Directional Losers (Stocks): FMX -$0.32, MKC -$0.1, SHOO -$0.14 points, and stopped out at PAY for -$0.98 loss.
Stocks gainls/loss are based on the price action from the trade trigger proint and are in terms of stock’s gains or loss; were options traded on these positions, the gains and losses would have been magnified. For instance – TSCO ATM/OTM option would have doubled during the day from the trigger point.
July 2012 was an unusual month requiring hedging income portfolios almost every week. We paid cost to hedge our capital last month (we needed to do so during massive European risk). Greece, especially, made the world go nuts. There was extreme fear everywhere. Then there are summit after summit. Had we not hedged, our Jul returns would have been in excess of +10%. However, Not placing hedge and then winning is confusing luck with smartness. This “smartness” may cause a permanent loss of entire capital (and I have testimonials from members who suffered that during 08/09 declines as people were already used to madness of 07 bullmarket). Had this doom’s day worked-out, I would have probably received similar testimonials. In trading, there is no coulda, woulda, shoulda. Hindsight always makes a perfect trade. But trading needs to be done with a FORESIGHT based on learning from the hindsight(s) and past.
We have great time ahead, Volatilities are low, earning season is in full swing and OPN Extra is warming up with other trade systems/set-ups. So if you are still on sidelines and have missed past several weeks’ action, sign-up for OPNewsletter now. There is no waiting list currently and OPIncome Newsletter subscription is open to all.
OP Income Newsletter subscription is currently opened without waitlist. We are starting to open the Aug income portfolios. If you were waiting on the sidelines, this is the right time to get in to benefit both from income portfolios as well as via on-going earning announcements. The trial is RISK FREE as new members will have first month FREE in case OPN doesn’t make money. For past performance, pls check the left side bar of this site. For recently introduced OPN EXTRA, pls check out the solid gains. So far our score card for earnings is rock solid too (INFY +175%, WYNN +24%, score 2:0).
Diversified approach that delivers consistent results over long term period
Short-term directional trading opportunities
Earnings/ M&A related speculative directional trading
Efficient market technical analysis based on volatility, market internals, sentiments, and classic support& resistances via P&F, Gann, Fib, divergences and more.
Here is a member’s perspective-
Hi OP,
I find it hard to put into words the value of the service you (and the whole OP community) offer the individual retail trader and investor. In my opinion, this style of options trading is the only path to consistent and repeatable profitability. I also have not found another service that puts all of these strategies together the way that optionpundit.com does. It feels like a true group of friends and peers that are learning and growing together, not just someone taking our money and throwing out trade ideas. I sincerely appreciate the time and efforts you put into your service for your members, especially at the price you offer it for. True knowledge is priceless.
Thanks Again, David Castello
Ormond Beach, Florida, USA
You may please read more subscriber’s testimonials here. Should you have any questions, pls let me know at OptionPundit@gmail.com
Apple (AAPL) closed below 50dma level again. Apple has pulled back almost $53 from the high since latest earning announcement. When a company announces earnings that almost doubled smashing even the most bullish expectations and the stock was already selling well below the average P/E ratio of the market, how can it continue to fall day after day?
After pulling back ~$80, there are a lot of theories supporting why AAPL has been falling. Some of those are-
This is profit taking as stock has almost doubled from lows since November.
AAPL shares are being unloaded to generate cash for Facebook (FB) IPO and once FB starts trading, money will flow back to AAPL.
Options are driving AAPL share pricing depending upon where market makers’ interest lies.
Whatever be the reason, do take a note that it is down just a 15% from the top on April 10th. Usually when a stock drops 10-15% from the high, it doesn’t create as much buzz. However, since AAPL is in completely different league thus everything around AAPL creates buzz.
So, where is it headed next? No one knows. And those who do don’t talk about it. This article is not to predict where AAPL is headed but rather to give you few “what if” scenarios which might potentially help you in preparation should that “what if” comes true.
First here is a chart summarizing daily price action of AAPL shares during recent past-
The Highest level is $644
Recent low prior to earnings is $555
On May 5th, AAPL closed at $565.25
(click to enlarge)
[Source : TD Ameritrade Charts]
After a 15% pullback, the key question now is where it can go next? There are three possible scenarios- (more…)
Monster Beverage Corp (MNST) recently traded in a very volatile manner. Just before lunch on April 30th, MNST spiked sharply due to an M&A rumour that The Coca-Cola Company (KO) was in talks to buy Monster. As a result MNST spiked almost +30% to $83.96 from ~ $64
Later, for several hours it then traded around $75 level before giving back all the gains when Coca-Cola denied discussions to acquire Monster Beverage. During last 10mins of trading, MNST shares dropped to close at $65. This kind of volatile, uncertain situation can be rewarding for traders who are day trading options and are equipped with proper strategies to trade such opportunities.
There are three ways to trade options on M&A plays
Pre- announcement (rumors)
During announcement (when a news surfaces in mainstream media but is not yet confirmed) and
When news is confirmed but M&A is not yet approved.
In this article, I shall show you how one could have profited from in situations like the one Monster’s stock experienced.
Apple Inc. (AAPL), the biggest publicly listed company on the planet is about to announce earnings on Apr 24th, after markets are closed. It is estimated that nearly 200+ Hedge funds have AAPL shares in their portfolio. And it is one of the most commonly talked about stock on almost every main stream financial media, website, forums, blogs, etc.
Here are some of the interesting things you may want to know before you go for that option trading strategy.
Since the last quarter earnings announcement, AAPL stock is up roughly 40% as of now (@$586 current market price). During this time, normally one would expect implied volatility (IV) to drop (and rise before next earning announcement). However, AAPL’s implied volatility (IV) almost doubled during this period!! (Find out what is Implied Volatility)
What's in Apple's store during this earning announcement?
