5/31 – 3;05 p.m. New York time
I entered four new positions today: BOX, CIEN, DG and PANW. I analyzed HPE as a potential earnings play but declined to take it.
I exited ADI for a profit and have an order in to exit AAPL, which has not been filled and appears unlikely to go through today. Nonetheless, I shall leave the AAPL order active and update if is executed before the closing bell.
Golar LNG Ltd. (GLNG)
Update 6/9/2017: GLNG declined for seven trading days after earnings were published. It bumped up a dollar to the upside on June 9, but with expiration a week away I judged that it had insufficient chance of reaching profitability, and so I exited for a loss.
Shares declined by 13.0% over 10 days, or a -476% annual rate. The options position produced a 53.8% loss on debit for a -1,967% annual rate
GLNG publishes earnings on Wednesday before the opening bell.
I shall use options that trade for the last time 17 days hence, on June 16.
Implied volatility stands at 51%, which is five times the VIX, a measure of the volatility of the S&P 500 index.
GLNG’s IV stands in the 15th percentile of its annual range and the peak percentile of its most recent broad movement. The annual range peak was reached in July 2016, nearly a year ago, so what we’re seeing today is a volatility recovery within a long-running downtrend.
Michael Kors Holdings Inc. (KORS)
Update 6/2/2017: KORS gapped to the downside after earnings were published and then moved sideways. I judged that there was little chance of an improvement in the week before expiration and took the loss.
Shares declined by 8.3% over three days, or a -1,011% annual rate. The options position produced a 7.0% annual rate for a -647.98% annual rate.
KORS publishes earnings on Wednesday before the opening bell.
I shall use options that trade for the last time 10 days hence, on June 9.
Implied volatility stands at 49%, which is 4.7 times the VIX, a measure of the volatility of the S&P 500 index.
KORS’s IV stands in the 79th percentile of its annual range and at the peak of its most recent broad movement.
Analog Devices Inc. (ADI)
Update 5/31/2017: ADI gapped to the upside after earnings were published and the pulled back. I exited at 27.1% of maximum potential profit.
Shares produced a net rise of 1.9% over one day, or a +692% annual rate. The options position produced a 37.2% yield on debit for a +13,586% annual rate.
ADI publishes earnings on Wednesday before the opening bell.
I shall use options that trade for the last time 17 days hence, on June 16.
Implied volatility stands at 32%, which is 3.1 times the VIX, a measure of the volatility of the S&P 500 index.
ADI’s IV stands in the 65th percentile of its annual range and the 80th percentile of its most recent broad movement.
In a reversal of T.S. Eliot, next week will begin with a whimper — the U.S. markets are closed on Monday for the Memorial Day holiday — and will end with a bang — the always much anticipated employment situation report, on Friday at 8:30 a.m. New York time.
The employment report will be previewed on Thursday by the private-sector ADP employment report, out at 8:15 a.m.
Three other major reports will be published during the week: Personal income and outlays on Monday at 8:30 a.m., the Institute of Supply Management manufacturing index on Thursday at 10 a.m. and international trade on Friday at 8:30 a.m.
5/26 – 3:25 p.m. New York time
Here’s the scorecard for the day before the markets close for a three-day weekend.
New positions: None. I looked at USO but didn’t like the grid because I couldn’t construct an iron fly structure with both short strike prices sufficiently near the at-the-money point.
Rolls to new expirations: One. I exited my EWZ position that expires June 2, rolling it forward to a June 16 expiration, collecting more premium in the process.
Exits for a profit: Three. COST, GME and BIG, all of them earnings plays.
Exits for a loss: One. The loss, on BBY, was also an earnings play.
I have exit orders in place on AAPL, CPB and MRVL that have not yet been filled. I shall leave them active until the closing bell and update this post if any of the trades go through.
A productive day of trading. Over the weekend, look for The Week Ahead and the first Live update for Tuesday. And I shall return to my trading desk (well, trading sofa, really) on Tuesday. Enjoy!
Costco Wholesale Corp. (COST)
Update 5/26/2017: COST gapped to the outside after earnings were published and then retraced a portion of the rise. I exited a week before options expiration, at 24.9% of maximum potential profit.
Shares rose by 2.0% over one day, or a +746% annual rate. The options position produced a 33.2% yield on debit for a +12,102.63% annual rate.
COST publishes earnings on Thursday after the closing bell.
I shall use the series of weekly options that trade for the last time eight days hence, on June 2.
Implied volatility stands at 19%, which is 1.9 times the VIX, a measure of the volatility of the S&P 500 index.
COST’s IV stands in the 52nd percentile of its annual range and the 94th percentile of its most recent broad movement.
Marvell Technology Group Ltd. (MRVL)
Update 5/30/2017: MRVL rose sharply after earnings were published, remaining high today despite an intra-day decline. I exited at 42.2% of maximum potential profit.
Shares showed a net rise of 3.2% over five days, or a +235% annual rate. The options position produced a +73.1% yield on debit for a +5,339% annual rate.
MRVL publishes earnings on Thursday after the closing bell.
I shall use the series of monthly options that trade for the last time 22 days hence, on June 16.
Implied volatility stands at 39%, which is 3.9 times the VIX, a measure of the volatility of the S&P 500 index.
MRVL’s IV stands in the 49th percentile of its annual range and the 88th percentile of its most recent broad movement.
Big Lots Inc. (BIG)
Update 5/26/2017: BIG rose sharply to the upside after earnings were published and then whipsawed, giving most of the gain back. I exited at 24.9% of maximum potential profit.
From entry the day before to exit, shares produced at net rise of 0.4%, or a +128% annual rate. The options position produced a 33.2% yield on debit for a +12,122% annual rate.
BIG publishes earnings on Friday before the opening bell.
I shall use the series of monthly options that trade for the last time 22 days hence, on June 16.
Implied volatility stands at 43%, which is 4.3 times the VIX, a measure of the volatility of the S&P 500 index.
BIG’s IV stands in the 67th percentile of its annual range and the 98th percentile of its most recent broad movement.
Tim Bovee, Private Trader 
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