HAL Analysis

Halliburton Co. (HAL)

Update 7/28/2017: HAL declined by $2 plus change after earnings were published and then swung into a sideways trend. As expiration approached, I exited at 5% of maximum potential profit.

Shares declined by 3.8% over seven days, or a -159% annual rate. The options position produced a +5.5% yield on debit for a +284% annual rate.

HAL publishes earnings on Monday after the closing bell.

I shall use options that trade for the last time 14 days later, on Aug. 4.

Implied volatility stands at 30%, which is 1.89 times the VIX, a measure of the volatility of the S&P 500 index.

HAL’s IV stands in the 46th percentile of its annual range and the 63rd percentile of its most recent broad movement.

The price used for analysis was $45.54.

Premium: $1.74 Expire OTM  
HAL-iron fly Strike Odds Delta
Long 48.50 90.3% 10
Break-even 93.50
Short 45.00 48.9% 53
Short 45.00 51l1% 47
Break-even 43.24
Long 41.50 88.6% 10

The premium is 50% of the width of the position’s wings.

The risk/reward ratio is 1:1.

Decision for My Account

I have entered an order on HAL as described above. The stock at the time of entry was priced at $45.05.

By Tim Bovee, Fukuoka, Japan, July 21, 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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