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Fair point interloper-- it depends on the strike price and premium for the options; but generally a movement that would cause an option to expire worthless is a lot greater loss (more than 2x) than if you purchased shares.
That is the greater risk and contributes to why many would argue to stay away from buying vanilla options.
Buying stock options is straight forward, especially since-- I assume -- you sold options to hedge your contracts (i.e. covered calls)? The biggest issue is time, given the other issues of direction and target are assessed by every Technical Trader regardless.
Even with time (options expiration)-- if you aren't buying too far Out-of-The-Money (OTM) -- you can roll-over options before expiry. You can gain time (roll out) or change your target (roll up or down).
I like options because it reduces my capital requirement to benefit from the same anticipated movement.
e.g. MCD @ $95.70 w/ tgt @ $97.00
$ at Risk/Outlay:
Shares: 100 x $95.70 = $9,570.00
Options: 3 x $3.65 (price of Sep 92.50 call option) = $1,095.00
Target: $97
Gross Profit Potential:
Shares: 100 x $1.30 = $130.00
Options: 3 x $4.50 (intrinsic value @ 97 - 92.50) = $255.00
In the MCD example, you could get almost 2x the profit @ roughly 1/10th the risk (exposure)/outlay ...
Have a great weekend NewView
Sold OUTR shares -3.12% in 4 daze #msg-104497740
Bought MCD Sep 92.5C (3.65) #msg-104677904
Bought PBR Aug 17P (0.61) #msg-104678044
Still holding:
CTHR shares (2.13) #msg-101893737
MBI shares (9.61) #msg-104500616
PBR [NYSE] Petroleo Brasileiro
Basic Materials | Oil & Gas Drilling & Exploration | Brazil
Inverse Pincher (assuming a retrace off of a run-up) Uses:
Trending: Inverse PPO (26,12,9) and ADX (14) for the Pincher
Momentum: Full STO (14,3) for drop thru Power Zone; TRIX for 3,3/7,3 Cross-under and thru signal line; Aroon (8) for Red/Green Crossover
Money/Volume: CMF 3/14 Cross-under and thru signal line; ChiOsc (Inverted Pairing: 3,10/10,3) for Red/Green Crossover (Money Flow Out)
tgt 16 (in Aug 17P)
PBR [NYSE] Petroleo Brasileiro
Basic Materials | Oil & Gas Drilling & Exploration | Brazil
Inverse Pincher (assuming a retrace off of a run-up) Uses:
Trending: Inverse PPO (26,12,9) and ADX (14) for the Pincher
Momentum: Full STO (14,3) for drop thru Power Zone; TRIX for 3,3/7,3 Cross-under and thru signal line; Aroon (8) for Red/Green Crossover
Money/Volume: CMF 3/14 Cross-under and thru signal line; ChiOsc (Inverted Pairing: 3,10/10,3) for Red/Green Crossover (Money Flow Out)
tgt 16 (in Aug 17P)
MCD [NYSE] McDonald's Corp
Services | Restaurants | USA
BB Pincher is a TA Setup looking for a turn/bounce off the lower-BB. Key TA is compression/release of:
(1.) %B (thru EMA 5)
(2.) ADX 3 downturn
Also;
(3.) TRIX 3 movement up thru TRIX 7 (key to confirm)
(4.) CMF 3 up thru signal line
(5.) The Aroons (8) to be moving in the right direction (for ultimate green-red crossover)
(6.) Inverted MACD calibrated to previous BB Pincher confirmations for MACD green-red crossover
Tgt 97 (in Sep 92.5C)
MCD [NYSE] www.finviz.com/quote.ashx?t=mcd[tag]McDonald's Corp
[/tag]Services | Restaurants | USA
BB Pincher is a TA Setup looking for a turn/bounce off the lower-BB. Key TA is compression/release of:
(1.) %B (thru EMA 5)
(2.) ADX 3 downturn
Also;
(3.) TRIX 3 movement up thru TRIX 7 (key to confirm)
(4.) CMF 3 up thru signal line
(5.) The Aroons (8) to be moving in the right direction (for ultimate green-red crossover)
(6.) Inverted MACD calibrated to previous BB Pincher confirmations for MACD green-red crossover
Tgt 97 (in Sep 92.5C)
Dag nice call Wildbilly!
Awesome-- congrats NewView
Sold XOM Jul 25 101Cs +27.53% in 14 daze #msg-103964172
Still holding:
CTHR shares (2.13) #msg-101893737
MBI shares (9.61) #msg-104500616
OUTR shares (55.21) #msg-104497740
I would pass on this one as a Pincher trade candidate starbuxsux as I prefer my Pincher set-ups to have certain minimum requirements displayed in the primary group of 3 signals:
1) RSI 14 dipping below 30
2) PPO 12/26/9 <= -10 (more flexible w/ this; in some cases it may approach -4)
3) ADX 14 > 40
I also like to characterize a Pincher-- in part -- by a rather sharp decline in a relatively short time-span & UFPI's decline seems too gradual and spread out over a longer time-span.
Lastly, while noting the appealing smaller float size (at just under 20 mill shares), the daily volume characterizes the stock as technically illiquid (with liquidity = daily volume >= 1% of the tradable float), which could create a problem when it came time to close the position.
I do like the potential growth storyline w/ sound back-dropped fundamental indicators, but not as a Pincher.
Sold CCJ Jul 25 19.5Cs +39.13% in 52 daze (includes roll-up) #msg-102618808
Bought MBI shares (9.61) #msg-104500616
Bought OUTR shares (55.21) #msg-104497740
Still holding:
CTHR shares (2.13) #msg-101893737
XOM Jul 25 101Cs (2.47) #msg-103964172
OUTR [NASD]
Outerwall Inc
Services | Specialty Retail, Other | USA
Looking for an entry (current bid @ 55.20) today w/ 54.29 stop & 59.75 tgt...
Looking for an entry (current bid @ 55.20) today w/ @ 59.75 tgt...
OUTR [NASD]
Outerwall Inc
Services | Specialty Retail, Other | USA
Expired GIMO Jul 17.5Cs -100% in 81 daze #msg-100989773
Still holding:
CCJ Jul 25 19.5Cs (*1.15) #msg-102618808
CTHR shares (2.13) #msg-101893737
XOM Jul 25 101Cs (2.47) #msg-103964172
Rolled Up CCJ Jul 25 19.5Cs (*0.10 credit) #msg-102618808
Still holding:
CCJ Jul 25 19.5Cs (*1.15) #msg-102618808
CTHR shares (2.13) #msg-101893737
GIMO Jul 17.5Cs (1.30) #msg-100989773 (revised guidance killed this trade )
XOM Jul 25 101Cs (2.47) #msg-103964172
Nice EoD buying (last 1/2 hour) to set up for a hopeful session tomorrow.
This is one of those highly liquid, highly shorted low floaters whose name brand and storyline is compelling to say the least.
The 3 Sides to John:
Side 1. To the retail investor/general public:
December 1, 2009 at 12:45 PM
John Bordynuik: You're witnessing something rare: a company's stock trading without a biased analyst BS'ing you and no stock promoters taking advantage of thousands of people. The company has no free trading shares to sell - its up to our shareholders to spread the word. Our trading pattern isn't odd.. it's what the market would look like without promoters, paid analysts or funds selling their stock to a song and dance.
Side 2. To insiders:
January 28, 2010 at 11:52 AM
John Bordynuik: I will provide the agreement I used for Jacob and Ron Kurp. The stock is coming from my holdings so the exchanges can't get funny about it. It is 500k out of my pocket so I am dealing with Gregg on the agreement.
My concern is how to deal with the employee stock option plan and salary. Cash salaries hit the bottom line hard and don't look like value-based management. The SEC created S-8 stock (or options) stock to allow a growth company to grow without having to pay exec salaries because the S-8 stock can be sold into the market as cash. They are securities registered for sale the moment I file it. They have been abused in the past so the SEC looks at these closely which will then in turn cause a greater flurry of requests to come from FINRA and the SEC.
Side 3. To enforcement:
OSC: On or about October 23, 2009, Bordynuik caused some of the shares represented by that certificate to be transferred to fourteen different transferees, none of whom were beneficiaries of the trust.
Again on December 10, 2009 Bordynuik caused 300,000 shares to be transferred improperly from the Childrens’ Trust’s account to the benefit of Bespoke Growth Partners. Bespoke Growth Partners was not a beneficiary of the Childrens’ Trust.
Bordynuik used the Childrens’ Trust account at DS as a reservoir of JBI shares which he then distributed to people who had provided services to or had been involved in or friendly to the company’s operations.
Bordynuik adopted this practice, which violated the terms of the Childrens’ Trust, so as to put free trading and not restricted stock, in the hands of third parties.
Nice buy! I think this is nice stock to showcase for 4th of July JER1 Luby's has been around a while and is pretty "mainstay America" IMO.
I like that is has a smaller float (< 20mill), but I would rather its volume trade closer to 1% of it (~200k) for liquidity purposes. Nice recent surge on expansion news that caused it to pop out of a classic falling wedge pattern.
Short-term I think is more tailored for a wait and see approach for a new entry. Most current signals are warning to the sell side although I see support right here at this level. The best support confluence is ~5.50
To the up side, H-Res is not too strong w/ the 6.10 area currently the most significant.
The CFO buys in June are a nice added sentiment bonus.
Happy 4th Weekend
Sold BGFV shares +7.97% gross in 58 daze #msg-101628953
(bid in for PM Aug 85C @ 1.90 #msg-103963974 )
Still holding:
CCJ Jul 19Cs (1.25) #msg-102618808
CTHR shares (2.13) #msg-101893737
GIMO Jul 17.5Cs (1.30) #msg-100989773
vn trade starbuxsux, congrats Happy 4th to you and yours as well!
XOM [NYSE] Exxon Mobil Corporation
Basic Materials | Major Integrated Oil & Gas | USA
Based off charger Bottom Buster scan. Like Jul 25 100Cs ~2.00 (would yield ~50% estimated intrinsic gain to mid-channel)
PM [NYSE] Philip Morris International Inc
Consumer Goods | Cigarettes | USA
Based off charger Bottom Buster scan. Like Aug 82.5Cs ~3.00 (would yield ~50% estimated intrinsic gain to H-Res)
Thanks and welcome JER1 Please don't hesitate to post-- the only request is no OTC tickers.
Flipped XOM Jul 11 99Cs +16.82% gross in a little over 1 hour #msg-103897267
(looking to give this one another go given the immaturity of the setup)
Still holding:
BGFV shares (12.05) #msg-101628953
CCJ Jul 19Cs (1.25) #msg-102618808
CTHR shares (2.13) #msg-101893737
GIMO Jul 17.5Cs (1.30) #msg-100989773
Anytime Would appreciate more opportunities to discuss trading styles, strategies, etc...
(FTR, ending up flipping XOM Jul 11 99C for 16.82% gross in a little over an hour. I decided to submit a sell based on a 5 min chart given weekly options usually get the best of me. I was looking for an easy win & the b/a spread was wide enough to trade a very doable intraday estimated intrinsic.)
FWIW, I establish both Risk (sell for loss) and Reward (target sell for gain) before every entry. I use the mid-bb as my pivot and Fibonaccis, MAs and Horizontal-Support/Resistance to monitor progress after entry.
(I post my trades on another board)
Although not a Pincher, I am eyeing a charger inspired "Bottom Buster" trade in XOM with Jul 11 99Cs for a move to 103 and a stop at 100. The potential gain is ~ 78% and since it is a weekly option, the only way to continue the trade would be to roll it.
Legit Bid Support can also "keep the draw bridge open" in order for disguised sellers to sail their boat through the harbor...
... to the Caribbean or other such exotic places.
How does one exactly tell the difference?
doh-- you made me look gt4 (that chart is not that pretty lol)
NGVC [NYSE] Natural Grocers by Vitamin Cottage Inc
Services | Grocery Stores | USA
Looking for an open/full session/close above mid-bb w/ short-term tgt $24.5
NGVC [NYSE] Natural Grocers by Vitamin Cottage Inc
Services | Grocery Stores | USA
Looking for an open/full session/close above mid-bb w/ short-term tgt $24.5
RNG [NYSE] RingCentral Inc
Technology | Application Software | USA
Looking for an open/full session/close above mid-bb w/ short-term tgt $14
RNG [NYSE] RingCentral Inc
Technology | Application Software | USA
Looking for an open/full session/close above mid-bb w/ short-term tgt $14
We are in agreement here:
Thanks for checking in Lao Congrats on BWP (I traded the shares @ +23.53% [stopped out just over $16 at the end of Apr]; but would have loved to have gotten in the Sep 15Cs too).
I totally understand trying to balance everything and still be able put the time in to be successful in trading.
Best wishes for continued success!
(FWIW, still doing research, but EBIX looks to be an interesting prospect if it can get past their legal issues...)