TRADE ALERT - Buy RIMM Oct 2008 105.00 calls

[forex-forex]

Quote from forex-forex:

Bought 20 contracts RIMM Oct 2008 105.00 calls @ $4.85.
Plan to sell on Friday.
$$$$$$$$$$$$

Sold 20 contracts RIMM Oct 2008 105.00 calls @ $0.15.

$$$$$$$$$$$$

 

[forex-forex]

Quote from GermanTrader:

Not sure who to thank, but I faded this RIMM tip. Thanks for the two grand.

You could rate this thread 5 stars if it made you $2000.

 

[GermanTrader]

Quote from forex-forex:

You could rate this thread 5 stars if it made you $2000.

Actually three grand, I was thinking after taxes.

 

[Clubber Lang]

Quote from forex-forex:

Bought 20 contracts RIMM Oct 2008 105.00 calls @ $4.85.
$$$$$$$$$$$$

Quote from forex-forex:

Sell on Friday for easy money.

Quote from forex-forex:

Sold 20 contracts RIMM Oct 2008 105.00 calls @ $0.15.

$$$$$$$$$$$$

 

[newguy05]

Quote from dagnyt:

But it wasn't. This coin had a very wide edge, meaning it had a decent chance of landing on its edge.

Think of a roulette wheel with 10 green 'zeros.'

Because IV was so high, merely being correct on market direction was insufficient to guarantee a profit. When forex-forex bought OTM calls at that super pumped implied volatility, his chances of success were much worse than the standard red/black scenario.

His wheel had all those green slots. That means there were scenarios in which the stock could rise and the calls decline in value.

Mark

but dagnyt speaking purely on volatility, in this case the IV/HV really isnt that bad. If you look at the IV today, it didnt "crash". I didnt plug this into my model, but if rimm moved a few dollars UP, the IV would dropped more, however i think FF still could made money.

What i am saying is the IV drop will not overcome delta/gamma in this case, if rimm moved up or even if the price stayed the same, his loss from IV drop would not be a big one.

 

[Mercor]

Quote from dagnyt:

Think of a roulette wheel with 10 green 'zeros.'
When forex-forex bought OTM calls at that super pumped implied volatility, his chances of success were much worse than the standard red/black scenario.

Very clear picture here.
10 green out of 36, very bad odds.

Can it be played , buying calls/puts 2-3 weeks before earnings then selling right before earnings...better to do straddles?

Has anybody ever studied this?

 

[RichardRimes]

I don't know... FF but when I saw this thread and that YOU started it I went UH OHH...part of the problem is that you consistently use options to make directional plays. Options by their very nature are hedging plays. If you thought RIMM would go up then the PROPER option play would have been a call vertical....not just an outright long call. At some point in time you really need to study and understand what options will or WILL NOT do for you. In the future if you want to make a play on a stock use the stock forum and say LONG XYZ or SHORT XYZ......not use the options forum to place your bets.

 

[stock777]

Quote from forex-forex:

Looks like it. My charts tell me a strong bounce to $120.00 within two weeks.

get new charts, maybe a new pastime

 

[Epiphany]

Quote from forex-forex:

TRADE ALERT

Buy RIMM Oct 2008 105.00 calls.
Earnings September 25 - Thursday after market close.

You picked up calls right before earnings on a high flying stock.

Even if you had made money, this is not trading, this is gambling.

If you are going to continue gambling, you are better off just closing your account and donating all of it to charity. You help a good cause and you get tax deductions.

 

[increasenow]

Quote from forex-forex:

TRADE ALERT

Buy RIMM Oct 2008 105.00 calls.
Earnings September 25 - Thursday after market close.

Sir...I honestly hope you did not do this..please confirm...RIMM tanked like $25...please confirm