Conservative Options Trades

DDR:
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http://online.barrons.com/article/S...59610629340766.html?mod=yahoobarrons&ru=yahoo

http://www.thestreet.com/story/1252...oration-ddr-today.html?puc=yahoo&cm_ven=YAHOO

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

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

Trade:
With DDR at 16.32
Jul 15/17.50 bull call spread for a net debit of $155
Yield = 95/155 = 61.3% in 111 days or 200% annualized


Price.....................Profit / Loss........................ROI %
11.00..................... (155.00)....................... -100.00%
13.00..................... (155.00)........................ -100.00%
15.00..................... (155.00)........................ -100.00%
15.44..................... (111.40)......................... -71.87%
16.55............................. 0.00............................... 0.00%
17.50........................... 95.00........................... 61.29%
18.00........................... 95.00........................... 61.29%
20.00........................... 95.00........................... 61.29%
22.50........................... 95.00........................... 61.29%
 
USO:

The consensus on oil pricing seems to be higher in the short term if US and Europe place restrictions on Russian oil, but lower in the longer term given increased supply and competition with natural gas.

Here I hypothesize sideways to down by 2016.

http://online.barrons.com/article/S...579459323209921860.html#articleTabs_article=1

http://247wallst.com/energy-business/2014/03/29/the-argument-for-75-oil-should-be-95-oil/

http://finance.yahoo.com/q/bc?s=USO&t=5y&l=off&z=l&q=l&c=

Trade:
with USO at 36.62
Jan '16 45/49 bear call spread for a net credit of $69
Yield = 69/331 = 20.8% in 655 days or 11.6% annualized
Prob = 82%
Expectation = .82(69) - .097(331) - .083(166) = 56.58 - 32.11 - 13.78 = 10.7


Price...........................Profit / Loss..............................ROI %
30.00.............................. 69.00................................... 20.80%
35.00.............................. 69.00................................... 20.80%
40.00.............................. 69.00................................... 20.80%
45.00.............................. 69.00................................... 20.80%
45.69................................. 0.00...................................... 0.00%
47.60.......................... (190.90)............................... -47.73%
49.00.......................... (331.00)............................... -82.75%
55.00.......................... (331.00)............................... -82.75%
60.00.......................... (331.00)............................... -82.75%
 
Ukraine and Crimea:

In listening to the ongoing reporting about this issue an important factor seems to be ignored: Economics

Economics is an essential and, I believe, a determinant factor.

Let me just spew out some facts that are never reported:

1. Russia and the Ukraine are very poor compared to the West. As estimated by the IMF per capita GDP in the US is $52,839. The same figure in Russia is $14,973. A Factor of 3.5 to 1.

In the Ukraine it is only $3,862

http://en.wikipedia.org/wiki/List_of_countries_by_GDP_(nominal)_per_capita

The future for Russia does not look very much better. The Russian economy has already shrunk for two consecutive quarters. A large part of Russia's economy is based on oil production and exportation, and the world is moving towards using less rather than more oil. As a response, Russia has already started to shift emphasis on selling its oil to China as opposed to Europe and the US.

China is very much less concerned than is the West about global warming and CO2 production.

Russia HAS to sell it's oil to somebody or it can't survive.

http://www.bbc.com/news/world-europe-26469461

http://www.bloomberg.com/news/2014-03-25/russian-oil-seen-heading-east-not-west-in-crimea-spat.html

http://www.npr.org/blogs/parallels/2014/02/21/280684831/why-ukraine-is-such-a-big-deal-for-russia

http://uk.reuters.com/article/2014/03/24/uk-russia-economy-idUKBREA2N13S20140324

The Ukraine's interest in increasing its NATO participation is a clear threat to Russia both politically and economically.

World War II was an Economic necessity for Germany. The treaty of Versailles made it impossible for Germany to survive economically and the resultant ascendance of the Nazi party in Germany was a logical result of this short sightedness.

As Putin implied in one of his 'speeches' recently, you cannot push a county to the brink of destruction and not expect it to respond.

$7 oil??? We'll have to put Russia on food stamps.
 
AMGN:

http://finance.yahoo.com/news/bull-day-amgen-amgn-050019336.html

http://www.bloomberg.com/news/2014-...rol-within-weeks-of-treatment.html?cmpid=yhoo

http://blogs.barrons.com/stockstowa...organ-stanley-says/?mod=yahoobarrons&ru=yahoo

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

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

http://finance.yahoo.com/q/bc?s=AMGN&t=5y&l=off&z=l&q=l&c=

Trade:

With AMGN at 120.55
Jan '15 82.5/77.5 bull put spread for a net credit of $30
Yield = 30/470 = 6.4% in 291 days or 8.0% annualized
Prob = 93%
Expectation = .93(30) - .04(470) - .03(235) = 27.9 - 18.8 - 7.05 = 2.1


Price............................Profit / Loss.........................ROI %
70.00........................... (470.00).......................... -94.00%
75.00........................... (470.00).......................... -94.00%
77.50........................... (470.00).......................... -94.00%
82.20................................... 0.00................................. 0.00%
82.50................................. 30.00................................ 6.40%
90.00................................. 30.00................................ 6.40%
100.00.............................. 30.00................................ 6.40%
120.55...............................30.00................................ 6.40%
135.00.............................. 30.00................................ 6.40%
150.00.............................. 30.00................................ 6.40%
 
MDT:

http://finance.yahoo.com/news/study-backs-nonsurgical-way-fix-130932257.html

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

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

http://finance.yahoo.com/q/bc?s=MDT&t=1y&l=off&z=l&q=l&c=

Trade:
With MDT at 60.41
Jan '15 47/42 bull put spread for a net credit of $30
Yield = 30/470 = 6.38% in 291 days or 8.0% annualized
Prob = 95%
Expectation = .95(30) - .01(470) - .04(235) = 28.5 - 4.7 - 9.4 = 14.4


Price.......................Profit / Loss.....................ROI %
35.00....................... (470.00)...................... -94.00%
40.00....................... (470.00)...................... -94.00%
42.00....................... (470.00)...................... -94.00%
46.70............................... 0.00............................ 0.00%
47.00............................ 30.00............................ 6.38%
50.00............................ 30.00............................ 6.38%
55.00............................ 30.00............................ 6.38%
60.00............................. 30.00........................... 6.38%
70.00............................. 30.00........................... 6.38%
 
EXAS:

http://finance.yahoo.com/news/exact-sciences-announces-fda-advisory-195200439.html

http://www.cbsnews.com/news/fda-panel-backs-non-invasive-colon-cancer-screening-alternative/

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

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

http://stockcharts.com/h-sc/ui?s=exas

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

Trade:
with EXAS at 14.17
Jan '15 10/8 bull put spread for a net credit of $30
Yield = 30/170 = 17.6% in 290 days or 22.2% annualized

Price.......................Profit / Loss...................ROI %
6.00............................ (170.00).................. -85.00%
8.00............................ (170.00).................. -85.00%
8.25............................ (145.20).................. -72.60%
9.70.................................... 0.00........................ 0.00%
10.00............................... 30.00..................... 17.60%
11.00............................... 30.00...................... 17.60%
12.50............................... 30.00...................... 17.60%
14.17............................... 30.00...................... 17.60%
18.00............................... 30.00...................... 17.60%

EXAS is a 'development phase' biotech (i.e. money losing) waiting for someone to buy it. The current owners have held onto the company in the hopes that they will get Cologuard approved which would greatly increase the value of the company.

This test is a tremendous advance because it uses a DNA signature to test for cancer.

http://newsnetwork.mayoclinic.org/d...ol-shows-unprecedented-detection-rates-2ac87f
 
oldnemesis said:
EXAS:

http://finance.yahoo.com/news/exact-sciences-announces-fda-advisory-195200439.html

http://www.cbsnews.com/news/fda-panel-backs-non-invasive-colon-cancer-screening-alternative/

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

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

http://stockcharts.com/h-sc/ui?s=exas

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

Trade:
with EXAS at 14.17
Jan '15 10/8 bull put spread for a net credit of $30
Yield = 30/170 = 17.6% in 290 days or 22.2% annualized

Price.......................Profit / Loss...................ROI %
6.00............................ (170.00).................. -85.00%
8.00............................ (170.00).................. -85.00%
8.25............................ (145.20).................. -72.60%
9.70.................................... 0.00........................ 0.00%
10.00............................... 30.00..................... 17.60%
11.00............................... 30.00...................... 17.60%
12.50............................... 30.00...................... 17.60%
14.17............................... 30.00...................... 17.60%
18.00............................... 30.00...................... 17.60%

EXAS is a 'development phase' biotech (i.e. money losing) waiting for someone to buy it. The current owners have held onto the company in the hopes that they will get Cologuard approved which would greatly increase the value of the company. It is my information the BMY will buy the company one of these days.
More...

The mid on that spread is $0.55.
 
WCG:

http://finance.yahoo.com/news/wellcare-strong-sell-202024624.html

http://www.theflyonthewall.com/perm...e-climbs-after-analyst-says-takeover-probable

http://www.fool.com/investing/general/2014/03/16/the-best-stocks-for-obamacares-medicaid-surge.aspx

http://www.theflyonthewall.com/perm...-to-Outperform-from-Market-Perform-at-Leerink

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

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

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

Trade:
with WCG at 64.39
Sept 45/40 bull put spread for a net credit of $35
Yield = 35/465 = 7.5% in 172 days or 16% annualized
Prob = 93%
Expectation = .93(35) - .02(465) - .05(233) = 32.55 -9.3 - 11.7 = 11.55


Price.................................Profit / Loss......................ROI %
30.00.................................. (465.00)......................... -93.00%
35.00.................................. (465.00)......................... -93.00%
40.00.................................. (465.00)......................... -93.00%
44.65.......................................... 0.00................................ 0.00%
45.00....................................... 35.00................................ 7.50%
49.89....................................... 35.00................................ 7.50%
60.00....................................... 35.00................................ 7.50%
70.00....................................... 35.00................................ 7.50%
80.00....................................... 35.00................................ 7.50%
 
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