I saw you response in Wilson's SA article today. As a matter of fact, I also bought more MU calls (April 19) while the pps had dropped to ~$24.50, not around the bottom ~$24.00 unfortunately. Some of the calls I got are for April 19 with the striking price of $27. Now I began to feel very unsafe about those calls and I think I have a big mistake. Is the strike price ($27) a little bit too high for April 19th so that MM can easily manipulate to render them worthless? I always have great respect for your research. I've lost ~30% for the April 19 $27 calls since I bought them. So could you give me your thoughts on the April 19 $27 calls? Is the strike price ($27) a little bit too high in your opinion? By the way, I also have IMOS shares.
nuoninuo, personally I prefer safer in-the-money calls with a low strike...just a personality preference, I like to try to ensure that they won't be worthless at expiration. It's difficult to predict whether it could be significantly above $27 -- I think it could go either way, it might take another month or two to get there. I don't think the market makers will be the deciding factor with manipulation, but rather market perception. With the last 2 earnings, even though the results were better than expected both times, the reactions by the market were very different.
If you are worried you could consider trading them for some July (or later) calls which should have a much better chance of surpassing the strike price. They would cost more, but the added safety might be worth it. The bulk of my calls are January 2015 which is less aggressive, but I sleep at night.
You didn't ask about IMOS, but since it's the IMOS board I'll give my opinion and say that I think we'll easily be a few dollars higher sometime this year, and potentially far more with a good business win.
Thank you very much for your reply! I'll do as you suggested and I'll sell the April 19 $27 calls I have and buy July or Jan 2015 calls instead. For IMOS, I'm just waiting for the stock to unfold and reach its true value some time this year.