Get started

Options-strategy

long / short TOWNTOWN Looking at the cyclical life of TOWN , it looks like the stock may have some room to grow. I would say advise buying short-term call options at close to price strike price. The company does not perform as well on the balance sheet side. I would advise executing the right to buy stock when the option contract expires, only to minimize the risk of the option by turning it into a long position. If more information comes in suggesting that the stock will under perform, I would minimizing the long position, and buying short positions with some put options. The opinions expressed are as of August 4, 2017, and may change as subsequent conditions vary. The information and opinions contained in this material are derived from proprietary and nonproprietary sources deemed by Diego Alvarez to be reliable, and are not necessarily all inclusive and are not guaranteed as to accuracy. As such, no warranty of accuracy or reliability is given and no responsibility arising in any other way for errors and omissions (including responsibility to any person by reason of negligence) is accepted by Diego Alvarez. This material may contain ‘forward-looking’ information that is not purely historical in nature. Such information may include, among other things, projections and forecasts. There is no guarantee that any forecasts made will come to pass. Dependence upon information in this material is at the sole discretion of the reader. This material is intended for information purposes only and does not constitute investment advice or an offer or solicitation to purchase or sell in any securities, or any investment strategy nor shall any securities be offered or sold to any person in any jurisdiction in which an offer, solicitation, purchase or sale would be unlawful under the securities laws of such jurisdiction. This disclaimer informs readers that the views, thoughts, and opinions expressed in the text belong solely to the author, and not necessarily to the author’s employer, organization, committee, or other group or individual. Diego Alvarez doesn't have any affiliation with Provectus Capital, nor receives any information, insight, or forecast, and does not have any communication with the firm.
NASDAQ:TOWN
by DiegoDA
ITCI - Breakout Long from $13.37 to $16.73 & 12.50 Call options ITCI was in our watch list for a while, and now it seems ready to go. Good insider buying from10% owner. We think it has Right now it is testing MA 200 resistance & it if can break above it can go much higher. On the option side we would consider August $12.50 calls @ $1.50 and November $15.00 calls @ $1.20 * Trade Criteria * Date First Found- July 20, 2017 Pattern/Why- Breakout Long trade Entry Target Criteria- Break of $13.37 Exit Target Criteria- $16.73 Stop Loss Criteria- $11.6 Please check back for Trade updates. (Note: Trade update is little delayed here.)
NASDAQ:ITCILong
by AcornWealthCorp
Brazil went down big, let's sell premium (Big lizard)After some negative news about bribery in the government the Brazil's ETF (EWZ) got killed at the open with a 18% down move. With the Implied volatility rank of the stock at the high's of the last 52 weeks(100%) it means that buying options is going to be expensive, in other words we are going to be selling overpriced options. Betting that this is an over reaction and wanting to take as much credit as possible, I decided to sold a big lizard (Straddle with no upside risk) to get a nice premium. The trade: 64 days to expiration Sold the 33 Calls Sold the 33 Puts Buy the 36.5 Calls (no upside risk) Collected 3.95 per contract Target price will be at 25%
AMEX:EWZ
by AlexanderGotay
WPM: Sell OTM puts for 9% p.a.On Friday, June 16, we successfully closed our previous short-put trade on WPM (see previous post below). Today WPM is showing continued signs of weakness, in an otherwise strong market. It is currently trading towards the lows of its trading range. It could continue to show weakness if the broader market continues its journey upwards. However, in the context of a much anticipated market correction and rather high equity valuations, any market correction should help push safe haven assets (precious metals) upwards. STRATEGY: Sell WPM 11% OTM puts on the September expiry RISK: Get exercised at the strike and end up long the asset 13% below current price REWARD: 9% annualized yield SELL WPM 09/15/17 $17 PUT = $0.40/SHARE (8.81% annualized) Depending on your risk appetite, the $18 strike and the Jan 19, 2018 maturity could also be interesting.
NYSE:WPM
by HAL9000
Targetting sub $2,000 on Bitcoin, BTCI am a big believer in the crypto-currencies. I am a big believer that these currencies are going to go higher in a big way. Much higher. I am also a very realistic person in that during the journey higher for BTC and ETH, the currencies will not be heading higher in a straight line. Instead, there will be moments the currency goes up and down, but over a very, very long period of time will go higher. So, given the concerns I had yesterday , and within the context of a move higher over a long period of time, I went long a "lottery ticket last night. The option price is still below the break-even level. But, given more time and the momentum the market has, this will go. After that, if the momentum dies down, I can go long spot for .50 size ratio 2:1 option to spot. That way, if the market continues lower, my options cover my losses and I am profitable. If the market continues higher, the option goes out of the money, spot goes into the money. Easy. Really.
BITSTAMP:BTCUSDShort
by ByDHTaylor
3
IBM: A better future ahead? Breakout confirmed over 154.26 in good volume, as expensive technology stocks continue to correct downward and the market continues to chase better value. IBM can now be purchased with a stop-loss at 150 and targets of 158/162/168/180. Blended reward-to-risk of 1.5x to 2.5x depending on where the momentum on the stock takes us. In the best case scenario of IBM reaching the top of the long term channel towards 175, the risk-reward becomes a compelling 4/1. Note that this breakout takes place just above the MA100 support on the weekly chart. Options strategy highlighted in related idea below still valid.
NYSE:IBMLong
by HAL9000
RDSA Short Straddle brings in significant yieldThe current dividend yield on Royal Dutch Shell is 7.22% - Some of the highest yields out there. Combining this with a similar yield on the 7% OTM put, and topping it off with additional income from selling an OTM call, brings in an exceptional annualized yield in excess of 15%. The risk is to be long an oil asset in an uncertain oil environment. However, this is mitigated by the blue chip status of the exploration giant, as well as the over-sized dividend yield. I size the trade to the minimum options contract size (100 shares), but any multiple of that would work. I use actual prices from a trade just effected for a client. STRATEGY 1. Buy 100 shares of RDSA at 23.80 Euros/share 2. Sell 1 RDSA 15JUN18 E22 PUT at 1.52 Euros/share 3. Sell 1 RDSA 15JUN18 E26 CALL at 0.48 Euros/share INCOME 1. Options premium cashed in at maturity = 1.52 + 0.48 = 2.00 Euros/share 2. Indicative annual dividend to be cashed in = 1.72 Euros/share 3. Total cashed in annually = 2.00 + 1.72 = 3.72 Euros/share YIELD 1. Yield from options premium = 2.00/23.80 = 8.40% 2. Yield from dividend = 1.72/23.80 = 7.22% 3. Total income yield = 15.62% OTHER This strategy is also available in USD and GBP. If the stock goes down to the strike level and the shares are assigned to the investor, one would end up being long RDSA at a net price of 20.90 Euros/share (purchase price of the shares, less income from options and dividends in the first year) which is some 13% below the current price. On the up side, assuming the shares reach the call strike and the investor is assigned and delivers the shares at 26.00, the profitability of the strategy would be 9.25% excluding any accrued dividends at the time of assignment, and excluding the accrued value of the options premia at the time of assignment.
R
by HAL9000
1