AAPL Analysis

Apple Inc. (AAPL)

Update 6/22/2017: AAPL remained in a narrow sideways trend during my holding period, and I have exited, ending the roll series at 33% of maximum potential profit.

Shares showed a net decline of 0.5% over nine days, or a -20% annual rate. The options position produced a 48.6% yield on debit for a +1,971% annual rate.

Update 6/16/2017: I have rolled AAPL forward to a new position that trades for the last time 14 days hence on June 30. The strike prices remain unchanged — that’s what makes it a roll rather than a new position — and the roll produced an additional $0.44 in premium, increasing the total credit for the roll series $3.79.

I shall defer calculating results until the series is complete.

AAPL stands at a high level of implied volatility compared to its most recent trend and so is worth looking at more closely as a potential trade.

I shall use options that trade for the last time 10 days hence, on June 23.

Implied volatility stands at 18%, which is 1.8 times the VIX, a measure of the volatility of the S&P 500 index.

AAPL’s IV stands in the 41st percentile of its annual range and the 51st percentile of its most recent broad movement.

The price used for analysis was $146.33.

Premium: $3.35 Expire OTM  
AAPL-iron fly Strike Odds Delta
Long 152.50 89.6% 11
Break-even 149.35
Short 146.00 49.1% 53
Short 146.00 52.1% 47
Break-even 142.35
Long 139.00 88.5% 11

The premium is 49% of the width of the position’s wings.

The risk/reward ratio is 1.1:1.

Decision for My Account

I have entered an order on AAPL as described above. The stock at the time of entry was priced at $146.35.

By Tim Bovee, Portland, Oregon, June 13, 2017


Tim Bovee, Private Trader tracks the analysis and trades of a private trader for his own accounts. Nothing in this blog constitutes a recommendation to buy or sell stocks, options or any other financial instrument. The only purpose of this blog is to provide education and entertainment.

No trader is ever 100 percent successful in his or her trades. Trading in the stock and option markets is risky and uncertain. Each trader must make trading decisions for his or her own account, and take responsibility for the consequences.

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