Apple Inc (AAPL)

[Dan321]

I'll give you my input. Thru experience, I've found playing way out of the money options are REALLY RISKY! Market Makers inflate options to be worth more than normal during earnings. After earnings they can deflate them to where you bought them, or worse, less than what YOU BOUGHT THEM FOR! I've learned that if you bye just out of the money, say 10 or 15, and a 50 dollar move is expected, you're 35 dollars in the money, and MM's cannot mess with that. Say the stock closes at 545 Monday. So if you bought 1 option for 11.50, strike 555, instead of 10 @ 1.50, strike 600, you are guaranteed profit if it opens at 585. But with a strike of 600, you are still 15 bucks out of the money, and who knows what the MM's will do with that. It may run to 600, but than again, it may not. It needs to go to 603.50 to get the same amount by expiration. And if it does, the 1 555 option would be worth 4,850, a profit of 3,700.00 dollars! This is all my opinion, but this is the way I am going to play AAPL on Monday. There is no guarantee Apple will crush earnings and it could dump if revenues don't beat expectations. But the worse feeling in the world is when it does go up 50 bucks, you were right, and because you bought way out of the money options, your profit just isn't there. One more scenario. Apple destroys expectations and winds up 620 on Tuesday. you made 20 Gs! That is the risk/reward that everyone talks about. I like to put the reward side more in my favor. GLTY and looking for a win on Tuesday!