Dear fellow stock options traders :
The 2nd Quarter Earnings Season in the US has started about 2 weeks ago.
It's a busy week as I honed my trading skills further using the earning gapping analysis technique.
The few companies that I've used this technique to trade options when they were reporting earnings were :-
1) Pharmaceutical Product Development Inc. (ticker : PPDI)
2) Columbia Sportswear Company (ticker : COLM)
3) CROCS Inc. (ticker : CROX)
4) Apple Inc. (ticker : AAPL)
Reasons for entering above trades
Pharmaceutical Product Development (PPDI)
On 13 Jul 2007, Jefferies downgraded Pharmaceutical Product Development (PPDI 39.82) to Hold from Buy, noting PPDI's development revenue growth is decelerating. Thus, put options were intiated.
Columbia Sportswear Company (COLM)
On 25 Jul 207, Caris reported COLM had experienced several years of significant operating margin declines. Trading at 17x forward ests valuation, COLM appeared steep for current growth rates and expectations. Thus, put options were initiated.
CROCS Inc. (CROX)
CROCS had a spectacular quarter when they reported Q1 earnings back in 3 May 2007. Boosted by the announcement of the 2-for-1 stock split, CROX gapped up almost $12.00 on 4 May 2007. I expect the momentum to carry on for the Q2 earnings thus I bought call contracts for their earning announcement this round.
Apple Inc. (AAPL)
Been following Apple's development for the past few months and understood from a news in Briefing.com back in 25 June 2007 that the Mac notebooks secured 14.3% of all notebook sales in the U.S. versus 12.5% in April, 2007 (almost two full percentage points in mid-spring). Apple didn't disappoint when they announced their Q3 earnings on 26 July 2007. Mac shipments were 1.76 mln vs the 1.7 mln street expectation. Gross margin was outstanding at 36.9% vs roughly 32.7% street expectation. Call options for Apple were very expensive due to the built up of high volatility leading to earnings announcement. However, the +$7.00 gap up after earnings announcement and ample time value helped maintain some profit for the near the strike call options.
Important : The above option positions were NOT initiated based on single news brief. I've been following these counters for some time and have kept abreast of their development. You need to dedicate time, research and accumulate a certain level of experience in order to pick out some of the stocks which could make a substantial price movement after earnings announcement, from amongst the hundreds of stocks reporting earnings every week. It takes much hard work to achieve this but the rewards are certainly worth the efforts.
As I was writing this entry, the US market was rather shaky. It has already shed more than 300 points on Thursday (26 July, 2007), mainly due to the cloud of uncertainty around pending LBOs (Leveraged Buyouts). The delayed deals for DCX, Alliance Boots in Europe, CSG and WCI - which have surfaced recently, signaled the tightening of the credit markets which made deals less attractive to the debt issuers.
Be sure to monitor your positions closely if you're call options buyers.
If you've managed to find out about the Live Freely! Seminar from my stock options trading blog and subsequently sign up for it, I hope you could do me a kind favour and mention Mr Tony Chai from Batch 14 as the referrer. Thank you for your kindness.
Wishing you Profitable in your Options Trading too.
Yours Sincerely,
Tony Chai
http://www.myoptionsonline.com
Friday, July 27, 2007
A Few Winning Trades
Friday, July 06, 2007
Big Announcement That Ron Ianieri Just Confirmed On the Phone With the Vice President of the Nasdaq
Fellow Options Traders :
There's going a major shift that is coming in Q3 of this year that will change how savvy investors trade forever.
Armed with the information that Mr. Ron Ianieri is about to share with you, you'll be centuries ahead of 99.99% of all other traders when it comes to making 'Pirate-sized' profit.s, even while protecting your portfolio.
Today at 12PM Noon EST (12 Jul 2007), the Options University is re-releasing their 2007 Edition Options Mastery Series, which has sold out on each of the last two limited releases.
That's because options trading is about to go 'mainstream' and you now have a rare chance to learn from one of the best in the business.
Listen to what some of the other experts in our industry have to say about Mr. Ron Ianieri and the Options University :
==> "The Options Mastery Series"
So let 'Today be the Day' you take the first step towards finding your personal fortune. In the coming months and years ahead, trading options in the 'new market' environment may just be the fastest and easiest way.
Will YOU be ready?
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Here's where to go at 12PM Noon Today (12 Jul 2007) to find out:
==> "The Options Mastery Series"
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(If you go there before Noon, you'll see a brief video of Mr. Ron Ianieri and a countdown timer for when you can get all the information and check availability)
whether you're trading options yet or not, I recommend that you go to this page today at Noon, and at least find out what it's all about...
Take Care,
Tony Chai
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LATEST!!!
Options University has just put up a complimentary chapter of the "Options Mastery Series" for you to view online (No strings whatsoever).
And it's not just the highlights, it's a full subject from the best-selling "Options Mastery Series", entitled:
The Greeks: Delta
Now for those of you who don't already know this, 'Delta' is one of the most important Greeks you can know when trading options.
Knowing the 'sweet spot' of an options Delta can make all the difference in the world...
It can make the difference between success and failure!
You can watch this entire session on Delta now, (and discover the 'sweet spot' of any option's Delta) by visiting HERE.
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P.S. Remember, the last two times the 'Mastery Series' has sold out of all available copies, and the last time they even pulled it down early. With the Nasdaq about to start listing options, NOW is the best time in history to learn how to trade options.
P.P.S. You can also read more 'rave reviews' of the Mastery Series below from other traders like yourself, getting results:
==> "The Options Mastery Series"
"This is powerful information that will impact my trading results immensely. I'm excited!"
- Eric Jackson, Kansas City, MO
"Not only did I learn a how I can start to supercharge my trading, I also learned a lot about the market overall."
- Laura Fleming, Ocean City, NJ
"Thank you for sharing this, no-one else is talking about this anywhere, but I'm glad I heard it first... Thanks, keep up the good work!"
- Fred Rolden, Grand Rapids, MN
"Wow, this is big news... and I love your passion! As a very experienced trader of 24 years, I can hardly wait for this to happen!"
- Alan Gardner, Burlingame, CA
