I have an urgent need to repay $10k debt and am thinking of risking a long April call at $450 strike and buy 10 contracts . If apple goes up another 20 to 30 points next week, I will have netted a 10 k profit.......or I will loose quite a change. I am thinking of pulling the plug Monday am on the call buy. Apple is having a momentum and I think it will carry on next week.....but than who knows:) . Anyone care to recommend a better play .....
Sentiment: Strong Buy
Two things to remember-the market is closed on Friday/Thursday will be light volume in the afternoon if history teaches us anything. Starting an open position on Monday and being forced to close it by Thursday means you had better be VERY lucky or Very well timed.
Also, 70% of OTM options expire worthless. Swinging for the fences will get you broke. Tell whoever you owe the money to that you lost all your money listening to idiots on a yahoo message board and ask if you can borrow the money from a friend if they'll take 50cents on the dollar. A sure winner.
Following a 2% move on any given day, buy an ATM/OTM spread. E.G. if AAPL falls to 455, buy a 455/460 weekly call spread for 2.50 or less. Sell for 3.75. Repeat. If AAPL goes to 475, buy a 475/470 put spread. This has worked for me. You know however that if you are successful you will come back until you lose everything. I did.
Actually I was thinking at something else. On Tuesday when the the weeklys are cheaper buy a straddle for $5 each. Fr example if the price is $460, buy $460 calls at $5 and equal number $460 puts. Chances are high by Friday you get a $15 swing from that point. Sell one position for $15 and you already have 50% profit even if the other one expires worthless. OR, sell either one of them for $10 (a $10 swing from Tuesday to Friday is a gives) and ride the other one for free.
Man, great idea. Considering that aapl can easily move $15 at least once in in any direction in 5 days by Friday, you could easily triple one position and let the other one expire worthless. That's an easy 50% gain per week. I'll give it a try with $10k and see how it pans out