Since the average volume is relatively low, it would be easy to control the price once the selling has subsided.
One of the advisors had recommended buying IEP at 110. Yesterday's low was close enough to the target to initiate buying. Icahn is not going to let this drop below 100, especially if he has a credit line secured by his shares. If you look at the options, the bid size for the calls are huge compared to the ask size. This means a lot of investors are looking to get back into IEP.
And he has not taken out any profits from Icahn Enterprises.
He has done everything a CEO should do. He sold the offering at the highest price possible. In a similar manner, he would have an obligation to buy shares back at the lowest price possible should he ever decide to do so. I could see him doing this when the pps drops to around 100. Knowing Carl, he would make a big public announcement and this would create a bottom. Even if he did not have the cash, he could still buy calls to lock in a purchase price and this would have the same effect.
Article by Forbes contributor Larry Downes
This article predicts that Best Buy will be out of business in a few years.
What is interesting is that this article was written in Jan 2, 2012, nearly two years ago.
The share price of companies like Best Buy and Sears are not determined by their fundamentals.
I am thinking of doing the long March 10 put / short March 50 call for a net debit of close to zero when done as a spread.
Also, the long Jan2015 5 put / short Jan2015 90 call for a net debit of close to zero when done as a spread.
The drawback of options having a wide bid/ask is that this may cause problems in your margin account. Even though I may be getting a good price when done as a spread. my account will be showing a loss due to the wide bid/ask.
Does anyone here understand how they work? Their value appears to fluctuate huge amounts every day.
This is unusual. Vxx and UVXY appear to be forming a bowl shaped bottom. This is normally a very bullish pattern. Maybe traders are expecting a down market next week. I am being more cautious by reducing my put positions in UVXY.
and call it "Amazon Dollars". The Amazon Dollars could be used to transfer money between individuals having an account with Amazon. Also, Amazon could give bonus dollars to individuals having Amazon Dollars in their account. This gain could be tax free. If enough money were deposited in Amazon, they may not need a credit line to run their operations. This could create a new form of currency and wipe out bitcoin.
I had noticed that for every 600 shares you were short in early 2012, you would now be short only one share. Are these hard to short with the brokers. I have only been playing this using puts but am thinking of going short the shares.
This was discussed by Jake Bernstein at Trader's Expo in Vegas this past weekend. He had suggested buying into any market weakness on Monday or Tuesday. I was going to buy the QQQ on Monday but did not do so. In hind sight, this might have been a good trade to hold through Wed. I wonder if the expectation of big retail sales for Black Friday is creating this market effect.
If you want to hold your shares for the long term to collect dividends, then you should not write calls against them. Think about doing calls spreads. For example, with INTC at 23.54, you could do the Feb 22/24 call spread for a debit of 1.24 This would give you an effective share price of 23.24 which is 0.30 below the current share price.
I found this other video by McMillan. Just insert "Using and trading VIX volatility derivatives futures options" in the search window of Youtube. He spends the first part talking about VIX and trading the VIX options. Then he discusses trading long and inverse VIX ETFs and ETNs. It is around an hour long and is definitely worth watching if you are trading the VIX derivatives.
One of the comments he makes, which everyone is probably already aware of, is the difference between an ETF and an ETN. The only caution about owning an ETN would be if the issuer (such as a bank) were to go bankrupt. Any holder of the ETN would be a creditor in bankruptcy and would get back just cents on the dollar.
He is using the VIX as a contrarian indicator. He also mentioned that the put/call ratio for the market is near a low. Most investors have stopped hedging their positions with puts. This is indicating that the market is overbought. However, he cautions against going bearish now due to the bullish seasonal trend. He is not going bearish until VIX rises above 14.
In case anyone is interested, Trader's Expo in Las Vegas is going on right now. You can view the sessions for free online. I have been listening to them today while trading at my computer. There is one session coming up at 2:45PM PST about finding better entry and exit points. Another at 4:00PM PST about spotting short term market turns. And another one at 5:30PM PST about advanced Fibonacci Time and Price analysis. They should be interesting. At least they are for free.
This bull market is actually going to hurt stocks like INTC and CSCO. Their momentum is lost. Maybe after the market corrects, buyers will be coming back in looking for value plays.
Do you really think this is the best use of cash for Yahoo? They are also selling notes to raise money for the buyback. This would be like you going to another bank to borrow some money so you can pay off part of your mortgage? Yahoo has the potential to be a great company.
What is your sell price target? If you want to go long at this level, take a look at my previous post. The premium collected from the sale of the put is used to buy the call.