Posted:
#1
Here we go. I have been investing and educating myself on investing and options since 2008. I have made a good amount of money since 08. Time to start a trading journal. Got burned on Apple's earnings and am going to implement a strategy to make some money back with a couple less risky plays that should guarantee profit as long as these stocks move enough in either direction.
First Earning Play is on Amazon.com. Amazon releases Quarter 2 earnings after market close today (7/26).
Going to implement a strangle with Amazon.com (AMZN). I have been following AMZN for years now. If AMZN misses earnings its stock will go well below $200. If AMZN beats earnings it should test its all time high in the $240 range. AMZN moves heavily after earnings announcements. I made a nice profit from buying OTM calls last quarter on AMZN before they released their earnings that beat expectations.
Last quarter I took on a lot more risk because I was only holding calls going into earnings. Worked flawlessly for me but here I want less risk to guarantee some kind of a profit as long as AMZN moves which I know it will.
Trade
Buy To Open AMZN Aug 18 '12 $205 Put (15 Contracts)
Buy To Open AMZN Aug 18 '12 $225 Call (15 Contracts)
My Next Earning Play is on Facebook (FB)
I really don't see any way that Facebook delivers an earnings surprise. I could be wrong but I have a hard time believing FB can generate over $1 Bil in revenue. I think there is more of a chance of beating EPS estimates but not sure about revenues. In my opinion Zuckerberg is a clown with little business savvy. I am going to implement a straddle with FB with ITM puts and OTM calls.
Trade
Buy To Open FB Aug 18 '12 $32 Put (15 Contracts)
Buy To Open FB Aug 18 '12 $32 Call (15 Contracts)
Overall, for Q2 I think it is somewhere around 75% of businesses have missed estimates. I am pretty bearish in the short term for our market. I also think FB will miss earnings. I think AMZN will continue its revenue growth and beat on EPS also. EPS is only .02 so shouldn't be very hard to beat that. Again, I could be wrong and that is why I am buying calls and puts for each trade. This way as long as the stocks move enough I will make a profit.
I will post my exact orders after I place them when the market opens today. Looking forward to making some money.
Also currently am holding
10 AAPL Sep 22 '12 $565 Puts at $19.95 a contract
I think after this miss Apple is going lower. I see it bottoming at $530. At the least I think Apple is going to $550 before it goes any higher. In May, Apple bottomed out at $530 before running up.
Current Exit strategy for these puts is when AAPL gets to $550 I will sell 5 contracts. I will hold onto the other 5 and see if it breaks $550 and try and let the other 5 run to $530.
If AAPL moves against me I am exiting at $585.
Today AAPL closed below its 10 and 50 day Simple Moving Averages (SMA). This is a bearish signal indicating the stock may go significantly lower. I think AAPL breaks $570 today.
Happy Trading/Investing Everybody
First Earning Play is on Amazon.com. Amazon releases Quarter 2 earnings after market close today (7/26).
Going to implement a strangle with Amazon.com (AMZN). I have been following AMZN for years now. If AMZN misses earnings its stock will go well below $200. If AMZN beats earnings it should test its all time high in the $240 range. AMZN moves heavily after earnings announcements. I made a nice profit from buying OTM calls last quarter on AMZN before they released their earnings that beat expectations.
Last quarter I took on a lot more risk because I was only holding calls going into earnings. Worked flawlessly for me but here I want less risk to guarantee some kind of a profit as long as AMZN moves which I know it will.
Trade
Buy To Open AMZN Aug 18 '12 $205 Put (15 Contracts)
Buy To Open AMZN Aug 18 '12 $225 Call (15 Contracts)
My Next Earning Play is on Facebook (FB)
I really don't see any way that Facebook delivers an earnings surprise. I could be wrong but I have a hard time believing FB can generate over $1 Bil in revenue. I think there is more of a chance of beating EPS estimates but not sure about revenues. In my opinion Zuckerberg is a clown with little business savvy. I am going to implement a straddle with FB with ITM puts and OTM calls.
Trade
Buy To Open FB Aug 18 '12 $32 Put (15 Contracts)
Buy To Open FB Aug 18 '12 $32 Call (15 Contracts)
Overall, for Q2 I think it is somewhere around 75% of businesses have missed estimates. I am pretty bearish in the short term for our market. I also think FB will miss earnings. I think AMZN will continue its revenue growth and beat on EPS also. EPS is only .02 so shouldn't be very hard to beat that. Again, I could be wrong and that is why I am buying calls and puts for each trade. This way as long as the stocks move enough I will make a profit.
I will post my exact orders after I place them when the market opens today. Looking forward to making some money.
Also currently am holding
10 AAPL Sep 22 '12 $565 Puts at $19.95 a contract
I think after this miss Apple is going lower. I see it bottoming at $530. At the least I think Apple is going to $550 before it goes any higher. In May, Apple bottomed out at $530 before running up.
Current Exit strategy for these puts is when AAPL gets to $550 I will sell 5 contracts. I will hold onto the other 5 and see if it breaks $550 and try and let the other 5 run to $530.
If AAPL moves against me I am exiting at $585.
Today AAPL closed below its 10 and 50 day Simple Moving Averages (SMA). This is a bearish signal indicating the stock may go significantly lower. I think AAPL breaks $570 today.
Happy Trading/Investing Everybody
0
Hot Forum Topics
