Ok, I had about 10 Call contracts that if they fell to 0 would mean I lost about $4900.00. They mostly expire in Feb but a few in March. Now, I have a 1 Put contract at the following prices Feb 490, Feb 485, Feb 475 March 440, and 2c March 430. I am still a beginner with options but my experience is telling me that my Puts value will definitely outweight the losses on my calls. Does this sound accurate? The Feb 490 put closed around 12 I think, the 485 around 10, the 475 around 8 bucks and then the 4 March puts were around 3 bucks or so. If one week ago the Feb 490 at like 485 or so was trading at 28 or 29 bucks, wouldnt it be trading well above that at 460 a share? Of course we dont know what the stock will open at but I am really trying to understand what I am looking at if I should see a gain from this. I really appreciate the help
Wall Street has a way to make people look foolish. Tomorrow morning when Apple's "blood is running in the streets" and everyone is going short and longs are in a panic to sell, YOU close out all your puts during the first hour of trading when Apple is at its lows and pat yourself on the back for making a killing on your puts. Then place 50% of your profits from your sold put options into MORE calls. at least 2 or 3 months from expiration
Apple is at 7 P/E with 137 Billion cash. No way it goes much lower. Follow Warren Buffett's advice and buy when there is blood in the street...
Sentiment: Strong Buy
The feb $490 will probably be trading around $36
The feb $485 will probably be around $31
The feb $475 will probably be around $27
March $440 will probably be around $7
this is rough, but should be somewhere in the ballpark.
As you know all options both calls and puts are valued using a formula with factors including volatility, time, and strike price. Prices will change everday and especially "LOSE" value or decay as more time goes by.
While both your calls and puts have alot of time left there is still value,especially given the fact that they are bought for a few dollars a share versus a few hundred. Volatility is what you want and seeing that you are more hedged on the short side you seem to make a profit tomorrow.
An example is the Feb put 490, today closed at 12ish relative to the stock price so they added a premium of 24+12 thats $36! alot (the premium is extra compared to most months because today was earnings). Lets assume Apple is at $460 tomorrow, now you are $30 in the money plus the time value until February, this value is the X factor, maybe it changes to 15-20?
Thanks you so much for your opinion! You guys are an asset to the community. I wish I could say I was happy but if I make a profit tomorrow it still will not be enough to make up for the loss I made in this stock. I should have never traded options untiL i was more educated. I lost 19K in options in Jan made 12K day trading since dec 28th lost 5K on the stock since then and another 19K in those options I have left but that is why I bought those put contracts because I figured I could only lose 4900 more and the earnings would tell me where this stock is heading and that is down. Its truly a value stock now. I see 425. Cook messed up bad. With that miss and NO GUIDANCE, he really needed to announce a new innovative product, a deal with China Mobile, divy increase, buybac or something....yet they did nothing! 67% growth in China and no China Mobile deal...doesnt take a genius to figure out how bad Cook is.