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GOOG - Yay or Nay
- Thread starter The Kin
- Start date
Quote from Rearden Metal:
No, he's suddenly going to become unsure of his GOOG pick.
You'll see in five minutes... he's going to show doubt and confusion on GOOG for the first time ever. "I don't understand" how it can be down like this, etc...
he blamed it on the kids not knowing how to do a conference call. the stock was priced for perfection and he should have known it could sell off.
Quote from Rearden Metal:
No, he's suddenly going to become unsure of his GOOG pick.
You'll see in five minutes... he's going to show doubt and confusion on GOOG for the first time ever. "I don't understand" how it can be down like this, etc...
He blames GOOG for a sour CC... States they know how to handle tech but not the Street. Uh huh, stock was down big before the CC.
Quote from riskarb:
Yeah, sharp move selling a $3.00 call. It'll open at $.80 for a massive $2.20 gain.
Why the playa hatin'?
If you had just asked, I'd gladly explain exactly why I chose this specific position for the situation. Regulars on these boards should be quite familiar with my track record on trades I've posted here in real time...and how they usually turn out.
Quote from Rearden Metal:
Why the playa hatin'?
If you had just asked, I'd gladly explain exactly why I chose this specific position for the situation. Regulars on these boards should be quite familiar with my track record on trades I've posted here in real time...and how they usually turn out.
I'm just teasing... I know you're a Big Swinging Dick, irrespective of ET recos. I have an inkling of how much you made at Schonfeld.
It's not a terribly sound-play, regardless of your rationale. Yeah, you sold high vol, but you're talking $.50 per 1000 basis lower on the implied-vol-line. You're selling extremely cheap dgamma, regardless of the vol% you sold.
The trade makes $2.00 tomorrow. Selling a bear-straddle[300 strike or lower] will net at least $1000 tomorrow morning.
Quote from zippie26:
Big brass ones. Good play.
Thanx. In retrospect, I'd have been slightly better off shorting calls closer to the money.
Why just slightly? Here's how they compare:
MARGIN: 360 calls -> $3,500 each.
320 calls -> $8,500 each
GOOG opens down -> both options drop big.
GOOG opens unch-> the 360's drop proportionately more than the 320's.
GOOG opens up 10-20 bucks- > Short 320 calls gets <b>killed</b>. Short 360 calls might lose a little bit, but not much at all. This happened on the last GOOG report. Stock gaps up 18 bucks. Shorting ATM calls got you killed, short deep OTM calls felt no pain.
Quote from Rearden Metal:
Thanx. In retrospect, I'd have been slightly better off shorting calls closer to the money.
Why just slightly? Here's how they compare:
MARGIN: 360 calls -> $3,500 each.
320 calls -> $8,500 each
GOOG opens down -> both options drop big.
GOOG opens unch-> the 360's drop proportionately more than the 320's.
GOOG opens up 10-20 bucks- > Short 320 calls gets <b>killed</b>. Short 360 calls might lose a little bit, but not much at all. This happened on the last GOOG report. Stock gaps up 18 bucks. Shorting ATM calls got you killed, short deep OTM calls felt no pain.
Absolutely right... but selling the 280/310 call backspread for a $4.00 debit will be worth $12.00 tomorrow morning. With similar upside risk. I just don't see the risk-reward favoring the selling of cheap-calls. In any event, you'll earn on it, kudos on the play.
I'm just teasing... I know you're a Big Swinging Dick, irrespective of ET recos. I have an inkling of how much you made at Schonfeld.
---Ok, in that case I can look at any criticism from you more seriously, and not dismiss it as the underestimating I'm used to.
The trade makes $2.00 tomorrow. Selling a bear-straddle[300 strike or lower] will net at least $1000 tomorrow morning. [/B][/QUOTE]
--- I wasn't positive GOOG would drop big. I wasn't in the mood to take a beating in case we were in for a repeat performance of the last two quarters. I got in at 3.20, which is where it was bid for much of the afternoon. I'll make closer to $3.00 ($300 for each contract shorted, or a profit of about 8% of margin required.) After the news came out, and it sold off to 295 and then bounced to 322, I also shorted stock on the way up, at 311.
That shouldn't turn out too badly either.
---Ok, in that case I can look at any criticism from you more seriously, and not dismiss it as the underestimating I'm used to.
The trade makes $2.00 tomorrow. Selling a bear-straddle[300 strike or lower] will net at least $1000 tomorrow morning. [/B][/QUOTE]
--- I wasn't positive GOOG would drop big. I wasn't in the mood to take a beating in case we were in for a repeat performance of the last two quarters. I got in at 3.20, which is where it was bid for much of the afternoon. I'll make closer to $3.00 ($300 for each contract shorted, or a profit of about 8% of margin required.) After the news came out, and it sold off to 295 and then bounced to 322, I also shorted stock on the way up, at 311.
That shouldn't turn out too badly either.
Quote from riskarb:
Absolutely right... but selling the 280/310 call backspread for a $4.00 debit will be worth $12.00 tomorrow morning. With similar upside risk. I just don't see the risk-reward favoring the selling of cheap-calls. In any event, you'll earn on it, kudos on the play.
Can you explain how the 310/280 call backspread is structured?
What ratio, etc...? I'd like to run the numbers and compare.
Quote from Rearden Metal:
I'm just teasing... I know you're a Big Swinging Dick, irrespective of ET recos. I have an inkling of how much you made at Schonfeld.
---Ok, in that case I can look at any criticism from you more seriously, and not dismiss it as the underestimating I'm used to.
The trade makes $2.00 tomorrow. Selling a bear-straddle[300 strike or lower] will net at least $1000 tomorrow morning.
--- I wasn't positive GOOG would drop big. I wasn't in the mood to take a beating in case we were in for a repeat performance of the last two quarters. I got in at 3.20, which is where it was bid for much of the afternoon. I'll make closer to $3.00 ($300 for each contract shorted, or a profit of about 8% of margin required.) After the news came out, and it sold off to 295 and then bounced to 322, I also shorted stock on the way up, at 311.
That shouldn't turn out too badly either. [/QUOTE]
Nice call on the short after the report; THAT took balls! They won't open those calls below $.70 tomorrow, but you're likely get a $2.50 gainer on the open. It just doesn't seem too satisfying to be so right and earn so little on the call-sale, regardless of the maths.
FWIW, I had shorted the 300 straddle very small and sold the backspread, 20x40 at a $3.00 debit, it closed at $4.00 today. The straddle loses $700/contract into a $20 dot-shot to 233, at worst-case with the vol-drop. Risk $700 to make $1000-$1200. Plus, you can park yourself in the thing and wait for the vol to be wrung out. Backspread was a much better play than the straddle.