CAT Puts

Pfizer options often disappoint however there are times when they can be your best friend. Let me try and explain. First look at it's five day chart. The 24.50 series of Calls have more than doubled in price in two days. Volatile stocks like this in this price range attract an inordinate amount of attention when it comes to option trading and it only flares up during these brief periods when the stock has these extreme price moves. Look at the open interest in this one series of Calls below. It's quite substantial. Now for a simple calculation. If the stock moves up today to $25.00 these $.37 cent options on the 24.50 series of options will probably move up to the $.55 cent range. Buy and sell let's say a block of 25 contracts and you will be rewarded with a nice gain. Now let we share this one observation. Here is a look at how the D.J.I.A. traded yesterday. It was down. Who wants to be holding short term Call options overnight if the markets are souring? Wouldn't t...

Here is the chart and the price of one series of it's Calls. Last week we did a blog about Disney Calls. Now at this time, any kind of an upward swing could cause these Calls to double. Yet it's Tuesday and these Calls don't expire until Friday. For lack of better words these options are sloppy options meaning they are "out-of-the-money" options and somewhat susceptible to falling of a cliff if the stock decides to go sideways or down for a day or two. It's not like buying Tesla on the closing hoping for a ten dollar move on the opening and getting it. That's one of the reasons the volume in them is so low. Now this, nothing much to report on it's Tuesday opening but they did jump to $1.16 at one point in time on the opening. To be continued. The struggled continues on Wednesday morning. Can you see the reference I made about sloppy options? Valuable time is slipping away. It's not like buying Calls on a Friday morning and having them double in p...

I.B.M. had a bad week. Here is how bad it was. Sometimes you see charts like this. It was down $74.89 on the week. What happened? The headlines said "I.B.M. just sent a warning to dividend investors". Something about it missing earnings forecasts because of an artificial-intelligence-related shift in it's customers spending. That is a new one that we don't hear very often. Which way is this stock going to now move? It's probably dumb to be chasing this when the outcome will most likely be all so random. Just walk away and let I.B.M. figure out it's own problems. It may take time. Here is what the Calls nearest to what the stock is trading at are doing going into Monday morning's action. These are options that expire this Friday. Don't gasp and say that the premiums exorbitant? There are still expectations that the stock could rebound after such a big price decline. Buying into a Call option position at this time after a big drop in price places you i...

I realize that this type of a blog has a limited appeal. Many readers would dismiss this blog as being crazy. I get that. A blog in part about watching option pricings on one particular series of Puts, the 215 series of Puts on Boeing move on a minute-to-minute basis on a Friday just before they expire. Here we are looking at Boeing Puts at 9:56 a.m. The stock has just gone up and the series of Puts shown above have gotten crushed. Now a look at it's five day chart. This is where it will get interesting. Notice the stock has already had a rebound off a sharp morning dip. Traders who used the 212.50 series of Calls on Boeing's soft opening were already well rewarded. Only 121 contracts have traded during this period of time. Here is what the indexes are doing. So that's it. You could wager $100.00 U.S. plus commisions for one Put contract (the 215 seriess of Puts that expire in the afternoon), or multiples thereof and walk away for the next three or four hours or so in t...