Conservative Options Trades

GRMN:

http://www.forbes.com/sites/ericsav...added-to-sp-500-stock-index/?partner=yahootix

http://www.forbes.com/sites/ericsav...to-sell-target-price-now-34/?partner=yahootix


http://finance.yahoo.com/news/piper-selects-garmin-g1000-integrated-120000716.html

http://finance.yahoo.com/news/garmin-3q-net-income-falls-200457235.html

http://finance.yahoo.com/q/bc?s=GRMN&t=2y&l=off&z=l&q=l&c=


Trade:
With GRMN at 41.83:
Apr 33/30 bull put spread for $25
Yield = 25/275 = 9.1% in 134 days or 25% annualized
Prob = 95%
Expectation = .95(25) - .01(275) - .04(137) = 23.75 - 2.75 - 5.48 = 15.5


pt-olathe.jpg
 
 
HON:

http://www.reuters.com/article/2012/12/10/us-honeywell-outlook-idUSBRE8B90H520121210

http://finance.yahoo.com/news/honeywell-issues-weak-2013-outlook-145437901.html

http://finance.yahoo.com/q/ks?s=HON+Key+Statistics

http://investing.money.msn.com/investments/financial-statements?symbol=hon

http://finance.yahoo.com/q/bc?s=HON+Basic+Chart&t=5y

Trade:
With HON at 61.76
Sell the Jun 70 call and buy the Jun 72.50 call for a net credit of $32
Yield = 32/218 = 14.7% in 193 days or 28% annualized.
Prob = 83%
Expectation = .83(32) - .12(218) - .05(109) = 26.6 - 26.3 - 5.45 = -5

update: filled at 35
 
CLNE:

http://www.forbes.com/sites/kensilv...-gas-fueled-cars-and-trucks/?partner=yahootix

http://finance.yahoo.com/q/pr?s=CLNE+Profile

http://www.fool.com/investing/general/2012/12/03/3-reasons-to-buy-clean-energy-fuels.aspx

http://www.fool.com/investing/general/2012/12/06/3-reasons-to-sell-clean-energy-fuels.aspx

http://finance.yahoo.com/q/ks?s=CLNE+Key+Statistics

http://investing.money.msn.com/investments/financial-statements?symbol=clne

http://finance.yahoo.com/q/bc?s=CLNE+Basic+Chart&t=5y

Trade1:
Sell the June $8 put for $35 credit
Capital Required: $765
Yield = 35/765 = 4.6% in 188 days or 8.9% annualized.
Prob = 89%
Expectation = .89(35) - .01(765) - .10(382) = 31.2 - 7.65 - 38.2 = -15

Trade2:
June 8/3 bull put spread for $30 credit
Capital Required: $470
Yield = 30/470 = 6.4% in 188 days or 12.4% annualized.
Prob = 89%
Expectation = .89(30) - .01(470) - .1(235) = 26.7 - 4.7 - 23.5 = -1.5

Trade3
June 8/13 bull call spread for $365 debit
Capital Required: $365
Yield = 135/365 = 37% in 188 days or 72% annualized
Prob = 41%
Expectation = .41(135) - .13(365) - .46(182)= 55.4 - 47.4 - 83.7 = -76


.............Trade1.........................Trade2.....................Trade 3
Price.....P/L..........%..............P/L............%.............P/L............%
1.........(665)......(87%).........(470)......(100%)........(365)..........(100%)
2.........(565)......(74%).........(470)......(100%)........(365)..........(100%)
3.........(465)......(61%).........(470)......(100%)........(365)..........(100%)
4.........(365)......(48%).........(367).......(78%).........(365)..........(100%)
5.........(265).......(35%)........(271).......(58%).........(365)..........(100%)
6.........(165)......(22%).........(161).......(34%).........(365)..........(100%)
7..........(65)........(8%)..........(65)........(14%).........(365)..........(100%)
8...........35..........4.6%..........30...........6.4%.........(365)..........(100%)
9...........35..........4.6%..........30...........6.4%.........(264)..........(72%)
10.........35..........4.6%..........30...........6.4%.........(161)...........(44%)
11........35...........4.6%..........30...........6.4%..........(58)............(16%)
12.........35..........4.6%..........30...........6.4%..........35................9.5%
13.........35..........4.6%..........30...........6.4%..........135..............37%
 
Quote from oldnemesis:

CLNE:

http://www.forbes.com/sites/kensilv...-gas-fueled-cars-and-trucks/?partner=yahootix

http://finance.yahoo.com/q/pr?s=CLNE+Profile

http://www.fool.com/investing/general/2012/12/03/3-reasons-to-buy-clean-energy-fuels.aspx

http://www.fool.com/investing/general/2012/12/06/3-reasons-to-sell-clean-energy-fuels.aspx

http://finance.yahoo.com/q/ks?s=CLNE+Key+Statistics

http://investing.money.msn.com/investments/financial-statements?symbol=clne

http://finance.yahoo.com/q/bc?s=CLNE+Basic+Chart&t=5y

Trade1:
Sell the June $8 put for $35
Capital Required: $765
Yield = 35/765 = 4.6% in 188 days or 8.9% annualized.
Prob = 89%
Expectation = .89(35) - .01(765) - .10(382) = 31.2 - 7.65 - 38.2 = -15

Trade2:
June 8/3 bull put spread for $30
Capital Required: $470
Yield = 30/470 = 6.4% in 188 days or 12.4% annualized.
Prob = 89%
Expectation = .89(30) - .01(470) - .1(235) = 26.7 - 4.7 - 23.5 = -1.5

--------------------------------------------------------------
Is your hedged position an after thought .
Just curious about your thinking on the two positions
cheers
john
More...
 
CLNE:

http://www.forbes.com/sites/kensilv...-gas-fueled-cars-and-trucks/?partner=yahootix

http://finance.yahoo.com/q/pr?s=CLNE+Profile

http://www.fool.com/investing/general/2012/12/03/3-reasons-to-buy-clean-energy-fuels.aspx

http://www.fool.com/investing/general/2012/12/06/3-reasons-to-sell-clean-energy-fuels.aspx

http://finance.yahoo.com/q/ks?s=CLNE+Key+Statistics

http://investing.money.msn.com/investments/financial-statements?symbol=clne

http://finance.yahoo.com/q/bc?s=CLNE+Basic+Chart&t=5y

Trade1:
Sell the June $8 put for $35 credit
Capital Required: $765
Yield = 35/765 = 4.6% in 188 days or 8.9% annualized.
Prob = 89%
Expectation = .89(35) - .01(765) - .10(382) = 31.2 - 7.65 - 38.2 = -15

Trade2:
June 8/3 bull put spread for $30 credit
Capital Required: $470
Yield = 30/470 = 6.4% in 188 days or 12.4% annualized.
Prob = 89%
Expectation = .89(30) - .01(470) - .1(235) = 26.7 - 4.7 - 23.5 = -1.5

Trade3
June 8/13 bull call spread for $365 debit
Capital Required: $365
Yield = 135/365 = 37% in 188 days or 72% annualized
Prob = 41%
Expectation = .41(135) - .13(365) - .46(182)= 55.4 - 47.4 - 83.7 = -76


.............Trade1.........................Trade2.....................Trade 3
Price.....P/L..........%..............P/L............%..............P/L...............%
1.........(665)......(87%).........(470)......(100%)........(365)..........(100%)
2.........(565)......(74%).........(470)......(100%)........(365)..........(100%)
3.........(465)......(61%).........(470)......(100%)........(365)..........(100%)
4.........(365)......(48%).........(367).......(78%).........(365)..........(100%)
5.........(265).......(35%)........(271).......(58%).........(365)..........(100%)
6.........(165)......(22%).........(161).......(34%).........(365)..........(100%)
7..........(65)........(8%)..........(65)........(14%)..........(365)..........(100%)
8...........35..........4.6%..........30...........6.4%..........(365)..........(100%)
9...........35..........4.6%..........30...........6.4%..........(264)..........(72%)
10.........35..........4.6%..........30...........6.4%..........(161)...........(44%)
11.........35..........4.6%..........30...........6.4%...........(58)............(16%)
12.........35..........4.6%..........30...........6.4%...........35................9.5%
13.........35..........4.6%..........30...........6.4%...........135..............37%
14.........35..........4.6%..........30...........6.4%...........135..............37%
 
 
In one of my many recurrent nightmares I am back in the ICU unit at Lankenau hospital where I used to work and Miss Krieger, the head nurse , is yelling at me about a patient who is literally dying in our hands... and i am at a loss as to what I can do.

In those days a Left Ventricular Assist Device (LVAD) was about the size of a large refrigerator and the chances of getting off one alive was practically zero.

I am glad to know that this is no longer the case:

THOR:
http://www.zacks.com/commentary/24965/thoratec-corp

http://finance.yahoo.com/news/thoratec-wins-approval-japan-163902087.html

http://finance.yahoo.com/news/thoratec-retained-outperform-164904789.html

http://www.youtube.com/watch?v=-Q2wyRwqboY

http://www.youtube.com/watch?v=bhEpx1id-ec

http://finance.yahoo.com/q/bc?t=5y&l=off&z=l&q=l&p=&a=&c=&s=thor&ql=1

Trade:
With THOR at 37.58
Buy the July THOR 35 call and sell the July 40 call for a net debit of $305

Price...................P/L
30.....................(305)
35.....................(305)
38.05...................0
40......................195
45......................195
 
Quote from oldnemesis:

In one of my many recurrent nightmares I am back in the ICU unit at Lankenau hospital where I used to work and Miss Krieger, the head nurse , is yelling at me about a patient who is literally dying in our hands... and i am at a loss as to what I can do.

In those days a Left Ventricular Assist Device (LVAD) was about the size of a large refrigerator and the chances of getting off one alive was practically zero.

I am glad to know that this is no longer the case:

THOR:
http://www.zacks.com/commentary/24965/thoratec-corp

http://finance.yahoo.com/news/thoratec-wins-approval-japan-163902087.html

http://finance.yahoo.com/news/thoratec-retained-outperform-164904789.html

http://www.youtube.com/watch?v=-Q2wyRwqboY

http://www.youtube.com/watch?v=bhEpx1id-ec

http://finance.yahoo.com/q/bc?t=5y&l=off&z=l&q=l&p=&a=&c=&s=thor&ql=1

Trade:
With THOR at 37.58
Buy the July THOR 35 call and sell the July 40 call for a net debit of $305

Price...................P/L
30.....................(305)
35.....................(305)
38.05...................0
40......................195
45......................195
More...

An ITM five-wide on THOR at 3.05? A debit? $0 decay and you're off on the credit.
 
Quote from atticus:

An ITM five-wide on THOR at 3.05? A debit? $0 decay and you're off on the credit.
More...
And don't forget, this 7 month spread is a so-called "conservative" trade.
:confused:
 
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