Earnings: IC vs Short Strangle

Quote from newwurldmn:

You were bullish 3 hours ago. Atticus's comment make you change your mind?
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Not quite. If you remember, I replied to your comment a while back:


Fundamentally though they have so many customers going to Europe and the European tourism env. with higher hotel costs is prolly gonna show up in their guidance which for the first time might cause the stock to drop. Not to mention the street this time has much higher expectations.

So how would I remodel the option with that outlook?
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So I've been bearish fundamentally but bullish based on historical earnings related activity- history doesn't necessarily repeat all the time.

Rather than be short and risk losing a ton, I've decided to take some chance and give myself a better risk-reward if I'm right. I'll risk a very small amount on the back month put and see if it works out. I won't lose out on much if I'm wrong.

But if I'm right, I stand to make a handsome profit- goes towards my tuition anyways LOL!
 
Quote from babutime:
Not quite. If you remember, I replied to your comment a while back:
So I've been bearish fundamentally but bullish based on historical earnings related activity- history doesn't necessarily repeat all the time.

Rather than be short and risk losing a ton, I've decided to take some chance and give myself a better risk-reward if I'm right. I'll risk a very small amount on the back month put and see if it works out. I won't lose out on much if I'm wrong.

But if I'm right, I stand to make a handsome profit- goes towards my tuition anyways LOL!
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Based on your flip-flop from a few hours ago take a look at:
  • PCLN @ $590.00
  • Buy Mar16 2012 565.00 Puts @ $16.20
  • Sell Mar16 2012 530.00 Puts @ $5.70
  • Debt about $10.00
  • Move the strikes according to how far you believe PCLN will drop, and how much you are willing to risk.


:)
 
Quote from ForexForex:

Based on your flip-flop from a few hours ago take a look at:
  • PCLN @ $590.00
  • Buy Mar16 2012 565.00 Puts @ $16.20
  • Sell Mar16 2012 530.00 Puts @ $5.70
  • Debt about $10.00
  • Move the strikes according to how far you believe PCLN will drop, and how much you are willing to risk.


:)
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Thanks Captain Obvious.... and it's "debit". We got it. Rain is wet. Moron.
 
Quote from atticus:

Thanks Captain Obvious.... and it's "debit". We got it. Rain is wet. Moron.
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:) "A picture is worth a thousand words" :)

InternetToughGuy.gif
 
Quote from ForexForex:

Based on your flip-flop from a few hours ago take a look at:
  • PCLN @ $590.00
  • Buy Mar16 2012 565.00 Puts @ $16.20
  • Sell Mar16 2012 530.00 Puts @ $5.70
  • Debt about $10.00
  • Move the strikes according to how far you believe PCLN will drop, and how much you are willing to risk.


:)
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Listen bud,

A kid can do that analysis. I'm not THAT new to trading.

And it's money I'm talking about. I'm not ashamed of changing my opinion at a whim.

Hell tomorrow I might go long straddle. I don't care as long as I think I have an edge with it.

Besides, I when I said I expect it to go up overall- I MEANT IT!

"But babutime, lol, you're contradicting yourself, lol"

Yeah, it seems like it. But I'm looking at the first moment- the expectation which is heavily lopsided. I wont elaborate much on that.

The fact that you were so concerned about my flip-flop (which really was me trying to find some good risk-reward scenario) shows that perhaps you're not so good with making money- being married to ideas is the the first sign of an emotional trader.
 
Quote from babutime:

Listen bud,

A kid can do that analysis. I'm not THAT new to trading.

And it's money I'm talking about. I'm not ashamed of changing my opinion at a whim.

Hell tomorrow I might go long straddle. I don't care as long as I think I have an edge with it.

Besides, I when I said I expect it to go up overall- I MEANT IT!

"But babutime, lol, you're contradicting yourself, lol"

Yeah, it seems like it. But I'm looking at the first moment- the expectation which is heavily lopsided. I wont elaborate much on that.

The fact that you were so concerned about my flip-flop (which really was me trying to find some good risk-reward scenario) shows that perhaps you're not so good with making money- being married to ideas is the the first sign of an emotional trader.
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Based on the above information I recommend you stay away from a PCLN earnings trade, it's too hot for you. Just sit on the sidelines and perhaps try a trade for next earnings when you have more confidence. :)
 
Quote from ForexForex:

Based on the above information I recommend you stay away from a PCLN earnings trade, it's too hot for you. Just sit on the sidelines and perhaps try a trade for next earnings when you have more confidence. :)
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And how will things change in the next trade? It's about how comfortable I am losing a couple $100 bucks. Which I am.

As for it being "TOO HOT", I've been through a few earnings trades already- AAPL and NTAP to name a couple.

As for the "information above", you obviously didn't understand my point so I'll leave it at that.
 
Quote from babutime:
And how will things change in the next trade?
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Depends on the info you provide.
Quote from babutime:
It's about how comfortable I am losing a couple $100 bucks. Which I am.
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$200.00 maximum risk? That changes things a lot on a $600.00 tech stock just before earnings, your options have been severely limited. Your looking at spreads only 1 strike apart or long DOTM.

Best to stay clear of PCLN with your meager budget, take it off your watch list :)
 
O well,

Just found out I can't even trade because I made some pattern day trades last week.

I'll have to wait a day before I make some trades.

Funny!

This is exams week for me anyways so I'll just step aside. Have one long call position in AAPL. And thats pretty much it.
 
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