OptionPundit

Tag: AMZN

  • OPNewsletter (Outperformance)- May’09 +6.1%

    Option Trading is equally useful to retail traders and can generate consistent income if used properly. Hope you enjoyed the free trade alerts for some earnings play (You may sign-up for the Basic membership that is free till Dec 2009)

    A Fantastic week for OPNewsletter! We played HAL, IBM, UPS and AMZN for earnings and all these one day players nicely added value to the portfolio. We chose to close HAL and AMZN and to keep IBM and UPS for further gains. These were special circumstantial opportunities and we took full advantage without having to worry which direction stocks will move post earnings.

    After many months of waiting, we crossed our 60% portfolio investment guideline. Maximum investment incurred was +64.4% and we shall continue to use that as basis for returns calculation even though we are now in credit generation phase. We have 42.5% in cash (assuming 10 k portfolio). The capital preservation strategy worked nicely. We moved out of markets in early when OPN subscribers were clearly warned of the upcoming market meltdown when I shared the need to stay away should Dow slips below 10,697. That was on Sept 15th, well in advance before the real disaster struck. As I always say, if you know how to preserve trading capital, you can always make it back to market. At OPNewsletter, Capital preservation is always a higher priority than missing a potential investment opportunity.

    Net, overall OPNewsletter is up +8.62% (x- brokerage commissions) and +6.13% (including commissions). We are nicely positioned to reap further gains and we still have 3 weeks to go for May expiration. I don’t have to worry so much about the market fall as that will further benefit our portfolios.

    • USO is down -1.34%
    • UPS is up +3.67%
    • IWM is up +6.08%
    • GDX is up +8.46%
    • X is up +13.01%
    • IBM is up +19.88%
    • HAL was closed for +22.69% and
    • AMZN was closed for +15.83%

    (If you would like to join for “No Profit, No Fee” OPNewsletter, pls click here to sign-up for the waitlist)

    We have reached our investment capital deployment goal for the month and I am not planning to add any more investment capital unless there are opportunity that I don’t want to miss at all. I am not expecting any major adjustments except in IWM if markets make strong move up. The probability favors downside.

    Looking forward to 16th positive month for OPNewsletter.

    Profitable Trading, OP

  • Thrilling Expiration Friday

    rambo3Too much to handle for the week which slowed down the postings this week. What a “Rambo Fed” action that was (I was looking for a picture replacing Bernanke with Stallone but gave up after a few searches). But guess what, was this really surprising, I don’t think so. Uncle Ben has already made this clear long time back.To find out what other tools Uncle still has in his magic box, you may want to read his speech delivered on Nov 20, 2002. For those who would like to know more deflation etc this does make a good reading.

    This “printing press” has created trillions out of thin air, and probably more can be create to fight deflation. The battle is on  by almost every other central banker around the globe. What was remarkable is the action of few things. Gold that shot-up from a low of 890 to 950 within a matter of minutes, EUR surged almost 400 pips (yes 400 pips), resource and commodity stocks shots (so did the Dow and S&P just to gave gains back later). Citi (C) planning for a reverse split and many more.

    Markets are behaving precisely the way expected and the  Nov lows probably will resist the Bulls move. But don’t be surprised if this rally continues further. This rally does have some substance to it and is different from the rallies we have seen so far.

    Today is March options expiration day. There will be plenty of opportunity to trade. If you are looking for some plays, may I point you to AAPL, AMZN, GOOG, GS, POT and may more. OPNewsletter subscriber could look for some real example of how we played google pinning in the past that resulted in +60% profit in a single day.

    Those who are looking for trading thrills SKF, SRS and other ultrashorts will lose a lot a intrinsic value today. The moves will be very strong and leverage will be extremely high.

    Have a Thrilling Friday,

    Profitable Trading, OP

  • Equity Option Expiration and Pin Opportunities

    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

  • OPNewsletter (Aug’08) : +2.0% (Open)

    For the week ending Aug 01, OPNewsletter is up +2.0% including commissions and +4.0% x-comissions. Though this was a great week for 3 portfolios delivering double digit gains, it wasn’t so for our 4th portfolio that is down double digit and is dragging overall results with it. Albeit, We still have two weeks to go.

    You may find out about more about OPNewsletter here. We shall be shortly opening our Sept portfolio spots.

    There were couple of bonus trade alerts as well that delivered solid results including AMZN, POT and AAPL. I also shared a free trade idea, using covered call strategy. Simple returns were +6.6%, while those who can use portfolio margining, it was over 10% for holding only 1 day.

    Next week is an important one, FOMC announcement is scheduled on Tuesday (Aug 5). Markets have been holding pretty well (>11,000) for sometime. However, from a long term perspective, I think my earlier post still holds true. Also don’t forget to re-read how to survive this market.

    These times require very close attention. Trade Carefully.

    Profitable trading, OP

  • OPNewsletter (Aug’08) : +3.0% (Open)

    Another profitable week for OPNewsletter; both for income as well as speculative directional trades. Even though we increased out investment by 17% (to 48.3%) since last week, our returns also increased from +1.24% to +3.06% this week (including commissions). Considering what happened in the broader markets past week, I am pleased with these results. On a big picture basis, we didn’t make any significant adjustments to any of the portfolios since opening. No adjustment are expected for any portfolios till next week too.

    Other then income portfolio, all the directional trades also proved money maker with exception on ISRG intra-day. AMZN and AAPL both delivered > +20% for 1 day holding periods. POT 230 Put directional calendar is also profitable. In fact I shared a list of expected “Big Movers” that I was analyzing and POT, AMZN, WFR, AAPL, CMG, BIDU and many more moved huge %.

    Few testimonials from OPN current subscribers-

    I have been an OP Newsletter subscriber for about 3 months. I’ve been trading options for 2 years.

    I am extremely Happy with my subscription. I have taken most of OP’s suggested Income Strategy trades and they have been overwhelmingly profitable. The ones I did not take, due to travel or just plain second guessing, ultimately turned out to be profitable as well. LOL.
    Most of the spec trades that I’ve taken have been overwhelmingly profitable as well.

    OPN differs from other Newsletters in that OP provides timely, suggested adjustments for his Income Strategy recommendations. He, or other subscribers, are quick to answer my questions. This keeps you in the trade with an expert assisting you, and teaches you how to trade these strategies at the same time. In addition, I have found OP to be very responsive to questions as well as feedback.

    I’ll be happy to answer any questions you may have.
    Feel free to contact me at smrusso@aol.com.

    Sam Russo
    Boynton Beach, Florida

    Thank you for the vote of confidence Sam. It’s members like you who keeps the community growing and learning from each other.

    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

    Thank you David. I appreciate your feedback. I hope OPNewsletter continues to deliver rather exceed the expectation that members have from it.

    Another interesting learning happened while I was playing WFR earnings with a bullish perspective. I landed in the worst case i.e. Stocked gapped down hugely vs my expectations. To add to pain, I was also assigned on WFR 55s. Keep an eye on the blog posts for strategy concept and on the forum postings for specific trade with prices (OPN subscribers) where I shall share with you how I turned that worst case into a profitable trade.

    Profitable trading, OP