No positions to enter today, as the earnings season winds down.
I exited my position on MO this morning, for a loss. It was well out of the money and I wanted to avoid all risk of assignment as the ex-dividend date approaches. I shall update the analysis later today.
By Tim Bovee, Portland, Oregon, March 3, 2017
I have no potential new positions on my desk for action on Friday.
By Tim Bovee, Portland, Oregon, March 2, 2017
I entered three new positions timed to coincide with earnings: ADSK, COST and SGMS. I also entered two story-stock, penny-stock trades using shares: ENRJ and XCO.
I exited BBY for a profit.
By Tim Bovee, Portland, Oregon, March 2, 2017
Scientific Games Corp. (SGMS)
Update 3/14/2017: SGMS began a steady declined after earnings were published. I exited at 23.0% of maximum potential profit.
Shares declined by 1.5% over 12 days, or a -47% annual rate. The options position produced a +29.9% yield on debit for a +910% annual rate.
SGMS publishes earnings on Thursday after the closing bell.
I shall use the APR series of options, which trades for the last time 50 days hence, on April 21.
Implied volatility stands at 64%, which is 5.6 times the VIX, a measure of the volatility of the S&P 500 index.
SGMS’s IV stands in the 29th percentile of its annual range and the 67th percentile of its most recent broad movement.
Costco Wholesale Corp. (COST)
Update 3/24/2017: COST gapped down sharply into unprofitable territory immediately after earnings were published, and continued to fall for a week before recovering a bit and falling into a sideways pattern, still unprofitable. I exited to avoid the risk of early assignment.
Shares declined by 6.0% over 21 days, or a -104% annual rate. The options position produced a -31.7% loss on debit for a -551% annual rate.
COST publishes earnings on Thursday after the closing bell.
I shall use the APR series of options, which trades for the last time 50 days hence, on April 21.
Implied volatility stands at 21%, which is 1.8 times the VIX, a measure of the volatility of the S&P 500 index.
COST’s IV stands in the 54th percentile of its annual range and the 68th percentile of its most recent broad movement.
Autodesk Inc. (ADSK)
Update 3/10/2017: ADSK fell sharply for three days after earnings were published and then rose back into the zone of profit, allowing me to exit at my target price, 25% of maximum potential profit.
Shares experienced a net decline of 1.9% over eight days, or a -87% annual rate. The options positon produced a 33.3% yield on debit for a +1,518% annual rate.
ADSK publishes earnings on Thursday after the closing bell.
I shall use the APR series of options, which trades for the last time 50 days hence, on April 21.
Implied volatility stands at 41%, which is 3.5 times the VIX, a measure of the volatility of the S&P 500 index.
ADSK’s IV stands in the 64th percentile of its annual range and the 58th percentile of its most recent broad movement.
One purpose of my account with the no-fee brokerage Robinhood is to try out things I otherwise would never try.
Example: I never do story stocks. I am not a trader who puts much store by the fundamentals. Me and Jim Cramer would not get along. Warren Buffett and I would not be best of buds. This is the simple reality.
And yet, today, I have entered two stock positions on penny stocks based on a story told by Investopedia.
The story, “Top 4 Oil and Gas Penny Stocks for 2017) is a tale of four oil patch stocks that have fallen on hard times in the fossil fuels price downturn: ENRJ, XCO, VNR and PTRC.
VNR on the Toronto Exchange and PTRC on the Pink Sheets aren’t traded by Robinhood. I opened positions on the other two symbols: ENRJ and XCO. Neither has a rating from Zacks Investment Research. There’s very little data available except for the price history, which shows that they were priced at $80 and $40, respectively, back in the day.
It’s a flyer, not a reasoned trade, except foe the story and the chart.
The last time I did something like this was in the depths of the Great Recession, when I bought into Fannie Mae for pennies, and ended up with several hundred percent in profit.
My motto for Private Trader is this: “Risk is good, as long as you know the odds.” I have no idea of the odds for these trades, so I am not being true to myself in placing them. But the amounts are small, so why not have some fun?
By Tim Bovee, Portland, Oregon, March 2, 2017
The three prospective trades in my pocket this morning — ADSK, COST and SGMS — continue to qualify for a further look, and I shall analyze them today and possibly enter new positions.
I have exited BBY at a bit above my target price and shall update the analysis with results later today.
By Tim Bovee, Portland, Oregon, March 2, 2017
I have three potential earnings plays up for analysis on Thursday: ADSK, COST and SGMS.
By Tim Bovee, Portland, Oregon, March 1, 2017
I entered no new positions.
The short call leg of my SU iron fly was assigned, placing 300 short shares of stock in my account at a market price of $31.33.
I bought back the shares at the strike price, $30 — a loss of $1.33 per share.
The remaining options are profitable at $29.49 and higher, and I have retained them in the expectation that they will expire profitably out of the money at the end of the day on March 17. If the opportunity presents itself, I will get rid of them early.
I will refrain from updating the analysis until the entire position has been unwound.
I am attempting an exit of BBY at my target price. I shall leave the order active and, in the unlikely event that it is filled before the closing bell, shall update Outcomes.
By Tim Bovee, Portland, Oregon, March 1, 2017
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