Choose! you are or are not a member..a friend..
To many's surprise, it is NOT a bearish signal but bullish one.
It says hold onto the stock but the stock appreciation will slow down and the premium on the calls will erode. For there is no defense against TIME for anyone.
AS a side befit it does give a hedge to the downside but this is not why it is suggested.
click "biglefthook_00" .This pulls up all my posts ( never knew this) and research those two calls..at this present time, both ideas are looking rather good.
However, the markets is like a lover...one day, smiling; the next...!
AAPl stock value will climb while 10 year will fall in next year or so
if it is negative the price stays the same because it is already priced for negative news
the Jan 2014 call spread between X and (x -$5_ is almost $5 up to $900 strike price. with GOOG.
However with AAPL, this call spread is only $4 at $400 with AAPL.
This shows GOOG has more strength...wall Street conviction than AAPL. Why? less options!!!
below $4 it is $4...only allowing a 25% return...not enough.
but above $400 the spread is less than $4..!
I use this to observe Wall Street's sentiment...identify their action...do not engage
Simplicity at its finest
look at ask of a Jan 2014 call (y) below $400 then the ask of the next call ( y+ $5)..this should be close to $4.50 but is $3.50....a 50% potential gain
Actually it is the $500 calls.
$400 calls have a 20,000 open interest.
Computers are playing in $50 increments...Buy lower call (x) then sell(x + $50) for 4 to 100% return
23,000 open interest Jan 2014 $450 CALLS...$495 IS THE HIGHEST AT 55,000 contracts.
Between $450 and $495 only four digit or less open interest on calls
$70 A SHARE.... TAX DEFERRED, CASH..
At $900, GOOG has a P/E of 30...properly priced for a growth stock.
James ramer's stock price prediction...many of Wall Street is shorting here, not that it makes a difference
ON APril10, GOOG was $767....today it is $908....$141 on paper..this puts $70 cash a share in your pocket today
JAn $900 call is the most active Jan 2014 call...
over 6,000 contracts which is not a lot of contracts but more than the others...if you own the stock...ell these.
Your giveaway is $970min seven months