Publications

8/30/12 Trade Alert: Sometimes Naked Puts are Better

“Sell to Open” December $65 Put on BP Prudhoe Bay Royalty Trust (NYSE: BPT) Option Symbol: BPT121222P65 Limit Order Price: $5.20 or more ($520 per contract) Directional View for Underlying Stock: Neutral Options for Income Portfolio: Conservative Income Approximate margin requirement per contract: $650 (excluding option premium received) 114-day return on margin: 80.0 percent Net […]… Read More

8/23/12 Trade Alert: Betting on a Dow-Stock Turnaround

1. Sell Put Credit Spread on Hewlett-Packard (NYSE: HPQ) “Buy to Open” November $13 Put and “Sell to Open” November $18 Put Option Symbols: HPQ121117P13 and HPQ121117P18 Limit Order Price: Net credit of $1.00 or more ($100 per spread) Directional View for Underlying Stock: Neutral to slightly bullish Options for Income Portfolio: Conservative Income Margin […]… Read More

8/16/12 Trade Alert: Rolling a Conglomerate

Vertical Roll on Leucadia National (NYSE: LUK) to December     “Buy to Close” August $22.50 Put and     “Buy to Open” December $17.50 Put and     “Sell to Open” December $22.50 Put Option Symbols: LUK120818P22.5 and LUK121222P17.5 and LUK121222P22.5 Limit Order Price for Three-Legged Vertical Roll: Net credit of $1.10 per share or more ($110 […]… Read More

8/14/12 Trade Alert: Two Rolls

1. Vertical Roll on Waters (NYSE: WAT) to November “Buy to Close” August $85 Put and “Sell to Close” August $75 Put and “Buy to Open” November $70 Put and “Sell to Open” November $80 Put Option Symbols: WAT120818P85 and WAT120818P75 and WAT121117P70 and WAT121117P80 Limit Order Price: Net debit of $3.15 or less ($315 […]… Read More

8/13/12 Weekly Briefing: Iron Condors vs. Double Calendars

Time-value decay is the only certainty in option trading, and consquently one should focus on option strategies that benefit from this phenomenon.

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8/9/12 Trade Alert: The Return of the Hedges

1. Sell Put Credit Spread on SPDR Gold Shares (NYSE: GLD) “Buy to Open” November $140 Put and “Sell to Open” November $150 Put Option Symbols: GLD121117P140 and GLD121117P150 Limit Order Price: Net credit of $2.00 or more ($200 per spread) Directional View for Underlying Stock: Neutral to slightly bullish Options for Income Portfolio: Downside […]… Read More

8/2/12 Trade Alert: Three’s Company Through Acquisition

1. Sell Put Credit Spread on Roper Industries (NYSE: ROP) “Buy to Open” November $85 Put and “Sell to Open” November $95 Put Option Symbols: ROP121117P85 and ROP121117P95 Limit Order Price: Net credit of $1.80 or more ($180 per spread) Directional View for Underlying Stock: Neutral to slightly bullish Options for Income Portfolio: Conservative Income […]… Read More

8/1/12 Trade Alert: Another Internet Gunslinger

Iron Condor on LinkedIn (NYSE: LNKD) “Buy to Open” August (1st week) $80 Put and “Sell to Open” August (1st week) $90 Put and “Buy to Open” August (1st week) $125 Call and “Sell to Open” August (1st week) $115 Call Option Symbols: LNKD120803P80 and LNKD120803P90 and LNKD120803C125 and LNKD120803C115 Limit Order Price for Four-Legged […]… Read More

7/27/12 Trade Alert: Closing Out the Short Call on Gunslinger

Buy to Close $235 Call on Amazon.com (Nasdaq: AMZN) “Buy to Close” July (4th week) $235 Call Option Symbol: AMZN120727C235 Price: Market order at 3:59 Eastern time Trade Rationale: The $235 call is in the money, so we need to close it out prior to the market’s close. Otherwise, it will be assigned against us […]… Read More

7/26/12 Trade Alert: A Consumer Staple Three-peat

1. Sell Put Credit Spread on Procter & Gamble (NYSE: PG) “Buy to Open” October $55 Put and “Sell to Open” October $62.50 Put Option Symbols: PG121020P55 and PG121020P62.5 Limit Order Price: Net credit of $1.20 or more ($120 per spread) Directional View for Underlying Stock: Neutral to slightly bullish Options for Income Portfolio: Conservative […]… Read More