Earnings Trades update

I am still on vacation but have taken some time this week to do a few new Earnings trades. Here is the Summary of existing positions (including the newly added this week):

  • $JCP  I am long the January 2015 $10 Straddle and short the October 31w 10/9.5 Strangle. I am short stock (hedge) at $9 (as of 10/08). Options Net: -$.56
  • $DPZ  I am long stock at $78 with a November 85/85/75 Collar PS. Options Net:   -$1.40
  • $NFLX  I am long the October 24 weekly 340/355 Call Spread. Options Net/cushion: $17.38
  • $GOOGL I am long stock at $504.92 with an October 24 weekly $540 Collar (2/3 size left). Options Net/cushion: $22.36
  • $CP  I am long the November 200/210/220 Call Fly and short the $180 Puts. Options Net: $1.05
  • $IBM  I am short the November 07 weekly $165 Puts (remaining part of a Put Calendar). Options Net: $3.10
  • $VMW  I own the October 24 weekly 91/95/82 Risk Reversal Call Spread. Options Net/cushion: $2.90
  • $PII  I am long stock at $146.84 with a November 150/150/135 Collar Put Ratio (originally was 160/145/135). Options Net: $1.30

Long-Term & IRA account positions review

Long-Term account:

  • $AIG  I remain long at $39 (since 02/08/2013) and short the November 50 Calls (covered obv). Options Net: $9.67
  • $COW  I remain long at $29.5
  • $GME  I am short the November 44/45 Call Spread. Options Net: $2.58 with stock gains of $5.40
  • $TAN  I am long the November 40/43/46 Call Fly. Options Net: $1.70

IRA account:

  • $ACHN  I am long the January 2015 12.5/20 Call Spread. Options Net: -$1.80
  • $DVA  I am long at $54 (since 10/11/2012) and short the January 2015 67.5 Calls (covered obv). Options Net: -$2.27 and stock gains of $11.85
  • $INTC  I am long at $31.5 with a Dec/Nov 33/33/29 Collar PS. Options Net: -$.01
  • $MAR  I am long at $59.5 with a Jan/Nov 65/67.5/0 Collar PS. Options Net: $.24
  • $MBLY  I have a December 45/60/45 Risk Reversal Call Spread. Options Net: $.63
  • $SLCA  I am short stock at $60. I am short the January 2016 $70 Calls & December $60 Puts (covered). Options Net: $11.38 and stock gains of $34.25

 

Swing Positions review

A quick review of current Swing positions in the personal account:

  • $CRR no material change this week, I remain short stock at $70.08 (2x size) and short the November $60 Puts (2x size). Options Net is: $4.48 and stock gains of $21.84
  • $LMT  I remain short the November $160 Puts. Options Net is: $3.15
  • $UVXY  I remain short the November 45/40 Strangle and short the ETF at $40 (a hedge). Options Net is: $22.96 and gains from ETF hedges of $4.56
  • $VDSI  I continue to own the November 17.5/20/15 Risk Reversal Call Spread. Options Net: $.33
  • $VNET  I remain long at $14.92 with a Dec/Nov 26/22 Diagonal Collar. Options Net: -$.18

Earnings Trade Design starring VMware and Polaris Industries

As we head into the heart of Earnings season, my focus on this segment of my trading increases – it is where I find some of the best opportunities for new trades. I use Options as a key component to most trades for a variety of reasons: lower capital requirements & the flexibility to participate in the post-Earnings price reaction.

It is an important step for each trade to do a thorough review – and sometimes I like to share that info along the way (from trades that are still in progress). I have 2 new trades that I did yesterday and I thought I would review where things stand now that the Earnings event is over.

VMware ($VMW):

  • I am Long the October 24 weekly 91/95/82 Risk Reversal Call Spread
  • This means I am long the 91/95 Call Spread and short the $82 Puts
  • This trades takes margin this week (or until the short naked Puts are closed)
  • The trade was done for a .05 debit

VMW_G

The above chart shows the close from yesterday. The current price in pre-market trading is $84 so I will need to monitor the short Put strike. It does not appear that I can get any value out of the Call Spread.

Polaris Industries ($PII):

  • I am long stock at 146.84
  • I have a November 160/145/135 Collar Put Ratio
  • This means I am short the $160 Calls (covered by stock) and long the 145/135 Put Ratio (1×2)
  • This trade does take margin due to the Put Ratio (until at least 1x of the short $135 Puts are closed)
  • This trade was done for a .55 credit

PII_B

The above chart shows the close from yesterday. The current price in pre-market trading is $149 but there has been very little volume (normal for this stock). With this trade design I can participate on any move up to $160 and I am protected down to $135 (+/- the credit received).

Trading Activity update

Here is a list of my trading activity today:

$UVXY  I am short this ETF on the $40 break (Sell Short Stop trigger, a hedge for the short November Option trade)

$CELG  I initiated a new long stock Fab 5 position today (Buy Stop at $90 trigger)

$TSCO  The short stock piece in the Submarine Basket was covered today. The November option pieces remain

 

Earnings Trade Ideas for Apple & Chipotle

For $AAPL:

Long Oct 24 weekly 102/104/95 Risk Reversal CS. This means you are long the 102/104 Call Spread and short the $95 Puts. This trade can be done for a small credit, takes margin, and you must be comfortable owning at $95 (or you can adjust to next week – or further out expiration if desired/necessary)

For $CMG:

Long the October 24 weekly 650/675/700 Call Fly with Short $575 Puts. This trade can be done for a $1.75 credit (and takes margin)