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Equity Option Expiration and Pin Opportunities

Published on August 15, 2008

Equity Option Expiration and Pin Opportunities

August 15, 2008

Today is a special day, a day that occurs only once a month offering good opportunities for intra day trading. Today is Aug’08 option expiration Friday.

Before I proceed to talk about opportunities, pls note that the threshold for automatic exercise of stock-settled in-the-money options is $.01. Long equity options in the money by $.01 or more will be automatically exercised. Please monitor all your expiring positions and check with your broker for if you do not want to be assigned. Also be especially careful with the estimated $.17 DIA dividend on Friday morning.

If you are looking for some past discussion, check out OP Forum (free section). If you are an OPNewsletter subscriber, pls check this link to see an example of GOOG pinning in action.

Top of the list includes Google(GOOG), ISRG. OIH, MA. Other key tickers to look at are Goldman Sachs (GS), Apple (AAPL), CME Group (CME), Amazon (AMZN) and Research in Motion (RIMM). But be careful, as options will lose time value and IV very rapidly. So if there are chances to make disproportionate money, so are the chances of loss.

Pls do your own due diligence and stress test your strategies, create “what if” scenarios and understand the risk/reward so are prepared in advance.

Profitable trading, OP

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