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Walmart Again

On Monday I did a blog on buying this week's Call options on Walmart for a morning move. Today is now Thursday and there was a big sell off in the markets yesterday. Tesla sold off for example and here is what happened to it. Today it is slightly rebounding as are so many other stocks. Thursdays however as oftened mentioned in recent blogs are not a good time to be purchasing one day options on stocks that expire the next day. Times change. In less chaotic times that's not always case. In the last few years there would be known upcoming Friday morning events like the release farm payroll numbers or other economic readings that would move the needle on the markets going up or down on on a Friday morning. In those markets it paid to get into option positions before the closing on a Thursday to get out on the Friday morning bounces were caused by the release of these premarket reports. So how is any of this revelant to Walmart's trading today? Well, there was a whole bunch o...
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Walmart. Does Five Days Buy You Enough Time?

Let's set the stage.
A five day chart and the current bid and ask on an "in-the-money" Call option by $.31 cents.
Notice the tight bid and ask. That's a good thing. Now this morning's early trading.
Light open interest in this series and light to moderate morning trading in these series on the opening. Would I want to hold onto a position like this for the entire week? It's kind of dangerous because at any moment an analysis could come out with a comment about "Christmas Retail Sales". It's something I would get into with the hopes of getting out of on the day. Imagine, people living south of the border that can find brokerages that don't charge fees on trading. In that environment nimble option traders can have a heyday playing options like this with a tight "bid-and-ask". Let's watch this one for a day and see what happens. Now this.
Thirty nine minutes later the stock is up twenty-two cents. What's nice about five day options is that time is not as much of a factor compared to trading options with only, one, two or three days of life left in them. Here we are now at 11:50 a.m. Call me chicken. I would get out. It's 11:50 a.m. It was a good ride with no hiccups. It doesn't always happen that way. Take a profit and run.
The end. Well not really the end. Here is how these Call options closed the day.They did actually hit a high or $2.02.00.

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