MCD Analysis

Tim Bovee1 Comment

McDonald’s  Corp. (MCD)

Update 7/28/2017: MCD rose by $7 after earnings wee published and then zig-zagged its way downward over three days, losing about half of its gains. I exited at 21% of maximum potential profit, below my 25% profit.

Shares showed a net rise of 1.8% over four days, or a +163% annual rate. The options position produced a +27.0% yield on debit for a +2,462% annual rate.

MCD publishes earnings on Tuesday before the opening bell.

I shall use options that trade for the last time 11 days later, on Aug. 4.

Implied volatility stands at 20%, which is double the VIX, a measure of the volatility of the S&P 500 index.

MCD’s IV stands in the 0th percentile of its annual range and the 98th percentile of its most recent broad movement.

Read More »

CAT Analysis

Tim Bovee1 Comment

Caterpillar Inc. (CAT)

Update 7/27/2017: CAT shares gapped upward after after earnings were published and then fell into an unprofitable sideways trend. I exited after three days for a loss in order to clear room within my options margin for other opportunities.

Shares rose by 5.7% over the the three days, or a +687% annual rate. The options position produced a 28.5% loss on debit for a -3,470% annual rate.

CAT publishes earnings on Tuesday before the opening bell.

I shall use options that trade for the last time 11 days later, on Aug. 4.

Implied volatility stands at 26%, which is 2.7 times the VIX, a measure of the volatility of the S&P 500 index.

CAT’s IV stands in the 57th percentile of its annual range and the 82nd percentile of its most recent broad movement.

Read More »

STX Analysis

Tim Bovee2 Comments

Seagate Technology plc (STX)

Update 8/4/2017: STX fell by $10 immediately after earnings were published and then reclaimed about $4 of the decline before settling into a sideways trend for the rest of my holding period . I exited for a loss at a $6.25 premium with shares at $33.53 as expiration approached.

The losing short puts breakeven strike that defined the losing side of the trade showed a 71% chance of expiring out of the money at entry. Those odds declined to 4% at exit, above two standard deviations.

Shares declined by a net 15.8% over my 11-day holding period, or a -525% annual rate. The options position produced a -47.7% loss on debit for a -1,5825 annual rate.

STX publishes earnings on Tuesday before the opening bell.

I shall use options that trade for the last time 19 days later, on Aug.11.

Implied volatility stands at 47%, which is 4.8 times the VIX, a measure of the volatility of the S&P 500 index.

STX’s IV stands in the 82nd percentile of its annual range and the peak of its most recent broad movement.

Read More »

The Week Ahead: Money rates, GDP and much more

Tim Bovee

The Federal Open Market Committee meets for two days, culminating in an announcement on interest rates on Wednesday at 2  p.m. New York time.

Their decision precedes public release of the first estimate of gross domestic product for the 2nd quarter, on Friday at 8:30 a.m.

Other major economic reports: Durable goods orders and international trade in goods, both on Thursday at 8:30 a.m., and two real estate reports: existing home sales on Monday and new home sales on Wednesday, each at 10 a.m.

Read More »

HAL Analysis

Tim Bovee2 Comments

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.

Read More »