CAT Puts

Third quarter profits were released. Now a look at a statement made after the release of their second quarter earning report three months ago. So if you were anticipating a price swing on the release of their earning's report could this be a profitable adventure? Suprisingly, yes and no. It depends on how you reacts to the stocks quick and precipitous decline. It also takes a bit of luck. Look at how the "near-to-the-money" Call options and Put options traded just after the release of this news. First the Calls. They lost 82% of the value at this particular time. The open interest number is just over 800 which is actually a small number when you consider Tesla options often trade 100,000 option contracts in multiple series everyday. Notice how these Calls, the 390 series actually traded down to $.14 or only fourteen dollars a contract before rebounding back up again to $1.42 in a short period of time. That was a nice rebound. Yet then again who would have the confide...

You don't see this very often. I follow Deere options. First it's five day chart. Now a look at the 410 Puts which expire at the end of the week. There is nothing strange about this. A few traders got in to play the downside. Now the 410 Calls and what do you see? 819 contracts traded in the first ninety minutes of trading on this series of Calls that expire at the end of the week. A number of contracts this large tells us something. Or does it? Let's investigate further. Let's look at the volume of trading in the Deere Calls one striking price higher. Why aren't more traders jumping into these ones if someone likes the 410 series so much? In the same sort of way why aren't traders jumping into next weeks Call options given the apparent spike in these Calls? Now a check with "Yahoo" at noon to make sure these reported numbers are correct. Yes,the volume of Call options traded is now 855 contracts. More typical numbers would be 10 or 20. Somethi...

I see this companies electric vehicles on the road and I have to admit they offer a fantastic ten year warranty. Are they reckless in making such a offer when they have no track history? Might not high servicing costs come back to bite them further down the road? Look at how the stock jumped this week on this good news. While high production increases are only one part of a companies story they are encouraging to their shareholders. Visit there website and learn about their dealership network. The waiting game begins to hear about their next earning's report. Now look at these three charts. Back on Sept. 6th I wrote a blog on "Nio", a chinese electric car company. Here is it's chart that I showed in that blog. It shows Nio jumping 25% in one week. Now let's look at it's three month chart. Recently I did some blogs on trading options in the five dollar range. The scary part is we have seen how other stocks in this space are down. Look at these four. None...

G.M. is pumping out vehicles and people seem to be buying them! Against that backdrop is that they are losing market share in China. Falling interest rates should help car sales. Does that mean that the Ford stock will also jump? They report October 28th. Look at it's 30 day chart and year to date chart. They have a history of earning suprises with some being not so good. Here is how the 11 series of Calls traded on Ford on Friday Oct.26th on next weeks 11 series of Call options. As these prices the stock would have to jump 40 cents on the week to make these Calls think about coming to life.Here is what happened. Now there is Tesla which reported their earnings after the markets closed on Wednesday Oct 23th. Here is how it traded on that day just prior to earnings report. The open interest numbers were quite low as sometimes we see like 150,000 contracts trade in one one series in one day. So the 212.50 series of Calls closed at $9.28. Now look at this chart and the closing ...

In previous blogs I have often mentioned how Boeing can pop after a weekend. It happened again this morning, a Monday morning. I could end the blog here and say that that's all I want to say. This time there was news. Was there a tip off that this might happen? Here is how it closed stronger at the close on Friday. It's not much of a tip off but something. Earnings come out in a few days. Now it's three month chart. . Which way is it going to trade next? That's not my point. My point is Boeing sometimes pops on Monday mornings. Most usually just take your profits on the opening and get out. Here is a look at how the $152.50 series of Calls which expire at the end of the week traded today, a Monday. Have you sold here the top on the opening today you would have gained about 50%. The reverse is also true. If there a hint of bad news would would probably cause a loss of the same percent. Most option traders dont't like holding "out-of-the money" Call opti...