AAPL stock split...which stock to trade now?

heavenskrow · Jun 17, 2014

So I am still a newb to options. Started last January doing mainly directional trades. Found a niche in AAPL, great gain potential even in a few points.

Now with AAPL's stock split, I am assuming the reward potential/cost is not worth it anymore? What do I need to trade to mimic what AAPL was providing prestock split??? Should I try to find a stock that is $500 or more? Any stocks you guys reccomend?
Thanks

newwurldmn · Jun 17, 2014

Why is the opportunity gone after the stock split?

drownpruf · Jun 17, 2014

Well, for one thing, vola has dropped from >23 pre-split (6/6/14) to under <20, post-split.

heavenskrow · Jun 17, 2014

newwurldmn said:
Why is the opportunity gone after the stock split?

well im assuming the cost of commission would increase significantly.
Let's say I was buying 5 contracts for $1000 each.
Now to use that same amount of value, I would need to buy up more contracts(more commission)to have a similar trade value.

newwurldmn · Jun 17, 2014

heavenskrow said:
well im assuming the cost of commission would increase significantly.
Let's say I was buying 5 contracts for $1000 each.
Now to use that same amount of value, I would need to buy up more contracts(more commission)to have a similar trade value.

Are commissions that big of a deal relative to your pnl volatility?

newwurldmn · Jun 17, 2014

drownpruf said:
Well, for one thing, vola has dropped from >23 pre-split (6/6/14) to under <20, post-split.

23 was the wrong price to begin with. so many people buying vol ahead of the split.

but OP implies is the share price "size" that's affecting his ability to profit on AAPL.

FXforex · Jun 17, 2014

Q: AAPL stock split...which stock to trade now?
A: AAPL

AAPL's June21 ATM call options (91.430) doubled from Friday to Monday on a modest 1% AAPL gain, and they still had 4 days to expiry.

drownpruf · Jun 17, 2014

newwurldmn said:
23 was the wrong price to begin with. so many people buying vol ahead of the split.

but OP implies is the share price "size" that's affecting his ability to profit on AAPL.

That may be, but HV is running at 15%. The stock is simply not moving. And yeah, 7x the comms is an impact.

FXforex · Jun 17, 2014

Commissions are a moot point. If you could trade AAPL options before the split you can trade AAPL options now.

drownpruf · Jun 17, 2014

FXforex said:
Commissions are moot point. If you could trade AAPL options before the split you can trade AAPL options now.

stfu you insufferable twat. Any order is 5-7x more costly. For your one lots it's of no consequence. Kill urself. I trade a couple thousand contracts a day... so it's a huge impact. And no, I have not traded AAPL since the split. Anyone who traded AAPL pre-split has reduced their trading in AAPL (notional-terms).