Hello, booyah and skeedaddy. I haven't posted as much lately which is a direct result of being busy. I have a few updates of options trading that I can detail.
I sold my call the day TSL was up 6.00, thinking that it would drop. I sold the call for 12.00, making a 57% gain in nearly 3 weeks. It has dropped and I'm looking to buy it back, possibly between 9 and 10 as I do not think it will drop all the way to the 40's. I believe 43-45 range is reachable.
The day I sold the call I bought 2 puts on a different solar company, YGE. I bought the Sept 17.50, almost for play but we'll see how it works out today. If markets go down today I'll definitely look to sell as I was merely buying it for play purposes. I bought 2 contracts for .40 and look to sell for .70. Remember, I'm not an expert yet, and I don't really feel like risking a lot of money when I'm only testing the waters. However, I'm off to a good start.
Two plays that I would look to jump in on is BBY and ACH. First, BBY. Please buy the BBY MAR 08 Strike price 45 with me. It sells for 3.20 a contract right now. I currently have 2 calls and have an order to buy 3 more today. There are several reasons why you should buy this option. BBY initially disappointed the street on first quarter earnings on or around june 21. The street expected .50 gain, BBY gave them .39. However, since that time BBY has done much that will increase share price up through March. First, BBY is very cheap. It flaunts a 13.8 F P/E ratio and a 1.1 PEG via Scottrade, and also trades at its 52 week low. BBY announced Jun 27 that they are going to repurchase 5.5B. Their market cap is 20B. You do the math, that's 25%. They are going to repurchase 15% by FEB 08, which is perfect for the MAR call. Since their announcement the stock has went down about 8%. The CEO, Robert Willet is also buying shares right now. The last time he purchased shares of BBY was in April 05, on a similar decline. The stock during that time had went from 40 to 32, and then it jumped to 50 (not sure if this was prior to earnings statement or not). Also, the short float is around 17%, so there will be a run up prior to earnings as some shorts will cover. A solid earnings report should cause all other shorts to cover meaning a boost in price (shortsqueeze.com). BBY also reports on the day the FED should cut rates. This stock is easily worth 60 dollars and I can see it reaching that point by MAR. Let's all buy the option and make money together.
ACH, Chalco, or aluminum company of china...This thing bounces around so much you can make money on the volatility of the option. I'm waiting for this to go down to around between 50 and 55 and buy a call option around 60 or 65 forDEC or JAN (not sure which month they have options for). Anyways, it should be a good play.
As for my previous calls...ALTR call options would have been ok if you had sold prior to and after earnings, but JCG would have lost us big money. I would have done very well with SIRI, had I bought options when I wanted to at 2.80. Now it's trading at 3.47 as the proposed merger appears it will go through. I'm going to make no play on SIRI, I will only hold the shares until the merger happens.
Get into the buy...best buy that is. Do it today as shorts will begin covering tomorrow and monday. Also, cramer does next weeks outlook tonight and may mention it which will give us a buy in at a lower price.
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