GOOGL - Bought 2 April10 557.50 Calls at $0.50

OTM-Options

OTM-Options

GOOGL - Bought 2 April10 557.50 Calls at $0.50

Thought I would share this trade with you guys. I expect GOOGL to have a pre-earnings rally this week so I bought some OTM calls, the order was filled at 15:41:01 EST today.

  • GOOGL at $545.99.
  • Bought 2 April10 557.50 Calls at $0.50.
  • 3 Days to expiration.


:)
 
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ok, wait - I don't track equities a ton, just looked at my model against it but - you're stating that GOOG is (at the time of your post) $545.99? I show last of 537.02 on Google finance, but my charts state a close of 544.80... wtf? lol this affects my close price value.
 
0% probability through expiration; I should have been more clear. But definitely don't hold it through expiration. Take any profit you can get, lol...
 
longthewings said:
"Thought I would share this trade with you guys. I expect GOOGL to have a pre-earnings rally."


Why?
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I'm very bullish on the overall US markets and expect the Nasdaq to break its all time high very soon. Earnings may be a catalyst to get things going and I would like to get my foot in the door beforehand.

GOOGL's weekly options are cheap and it doesn't take much to get a 100% plus increase on the calls or puts. Since I'm bullish I will buy the calls, and to prepare for the unexpected (homerun) I will not cap any potential gains with a debit spread. My risk/maximum loss is already defined.


:)
 
xandman said:
1%-2% probability right now. Though when you bought it, it had 16-18% approx.
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The probability goes from 16-18% all the way down to 1%-2% after 19 minutes of time decay and a $1.13 drop on a $500+ stock? That's why I'm very skeptical about the usefulness of the option greeks.



:)
 
OTM-Options said:
The probability goes from 16-18% all the way down to 1%-2% after 19 minutes of time decay and a $1.13 drop on a $500+ stock? That's why I'm very skeptical about the usefulness of the option greeks.



:)
More...


Option's greeks are an instantaneous value of the rate of change.. They change all the time.. Maybe there was a better delta bet you could have made with a calender or something.. sell in front of earnings, buy a farther out at the same strike that doesn't expire before earnings.. maybe near the money.. This is a far better strategy for a delta pre earnings bet.. imo..
 
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