MU Calls:
Options are priced in a manner to make them look attractive as investments as they both limit and define maximum dollar risk, and they also provide leverage so that it is possible to make more on a percentage-of-cost basis by spending less than if one directly buys the stock . But that attractiveness is offset with an equal amount of risk achieved by option value decay.
I can't say for sure but I think most options traders cut their costs (lower their risk) by using spreads on nearly every trade, which limit gains (raising their risk). Again, little is gained unless one trades in and out of one of those positions when an opportunity arises (and they almost always do if there is enough time in the contracts).
So how does one get the advantage when trading options? The same way as with trading stocks directly. Price patterns that are expected to repeat, and/or business outcomes that are expected to repeat.
I am as certain as I can get that MU will announce earnings that will exceed expectations (my expected business operations opinion) and I expect MU to jump higher on earnings release and I expect it to continue higher within its inclining channel (a technical trading pattern which has been synchronized with business operations). And I spent more for my current Call options by buying later expirations, which gives me more time flexibility to adjust to changing conditions which could be to my advantage if I can execute correctly (sell higher Calls on the initial purchased Calls).
I would bet that a lot of option traders have a Synthetic Long on MU.
I have a lot of confidence in MU, so I have a ton of its stock. Many months ago I was doing Buy-Writes on MU, but no more. In fact, I've even averaged up on my share count. All I do with options on MU is to buy Calls going into earnings then possibly write CCs against those Calls near or after the bounce or just sell the Calls to take profits and wait till next time.
