I am expecting some longs will be selling into any YHOO rally tomorrow to raise cash to buy Alibaba thinking it will be a better long term investment.
If on Friday morning the share price were to spike up to 50, it may be difficult to get a good price to sell your long calls since they will be deep in the money. One thing I sometimes do to lock in my profit would be to sell short a higher strike call. In this case, you could maybe sell short a Sept 45-48 call and create a spread against your long call. Then you are able to close it out as a spread and get a better price. Instead of selling your calls in 0.10 increments, you can close out your spread in 0.01 increments. Of course you would have to close out the spread before the end of the trading day if they are Sept options.
Take a look at the history of DNDN. There is no real bottom for this type of stock.
Consider an option strategy instead of owning shares. This would limit your downside risk.
For example, with MNKD at 6.19, you could acquire the Jan16, 5.00/10.00 call spread for around 1.40
The amount paid for time premium would be relatively small, only around 0.20
Max profit would be 257%
Even though YHOO is in QQQ, it is just under 1%. The money to buy BABA is going to have to come from somewhere. Today's decline was probably predictable since the sold stocks will have to be settled before Friday's IPO.
What about the Panasonic HX-A500H. This is a wearable 4K camcorder which is waterproof.
There are numerous other wearable waterproof cams available.
I noticed that USO and FCX appear to be on similar paths. Both went from around 39 now down to around 34.
Does it look like this: http://www.kiowaok.com/cheap-replica-patek-philippe-grand-complications-watch-pat327-tourbillon-windows-rose-gold-case-hollowed-dial-moon-phase-brown-leather-strap
Yours is probably the real thing. I was thinking of getting one of these replicas as a novelty.
I just sold half of my calls I had bought yesterday near the close.
With yesterday's volume being around 11 times normal, I find it surprising that the drop was only around 6%.
Capitulation? A lot of buyers did come in at around 45 which appears to be a major support area. Today's price action looks good, especially with oil being down. Maybe a good chance for a 50% retracement.
If someone was bullish on HLF, selling these puts short for 8 would actually be a good trade. A good plan would be to roll down to lower strikes in case the price declines. It would not surprise me if someone like Icahn is already doing this trade.
If the share price were to drop to 40 within the next few months, he would make around 40% profit on his Jan 2016 put options. He could then start scaling out of his position. Another strategy would be for him to start selling short lower strike puts as the share price declines to create put spreads. But most likely, he is not planning to do any of these strategies. I agree that he is paying a huge time premium for these options. One of the most difficult decisions is when to take your profit. If he is determined to prove a point, he may end up holding these puts for too long and lose all of the premium.
Nice rally! Any Fed intervention today?
I think the Fed would be happy if the market just trades in a channel for the rest of this year, with a lot of volatility of course. Maybe with a lot of days like today, they could make enough money to pay off the national debt.
Which strikes do you own?
I only have options for BX. I have a core holding position and trading positions. Try doing some call spreads whenever it dips. You can acquire a position having an effective share price below the actual share price. For example: Jan2015 30/34 call spread for around 2.30, effective share price would be 32.30 (0.70 below current share price).
If you look at the 2 previous large declines for this year, Jan 23 and April 4, each one of these had 2 major down legs with a slight upward bounce in between. Now, is this the bounce before the second major leg down?
If you are now all cash, how are you planning to get back into the market?