Monday, October 28, 2013

Oct 21 to Oct 25 week recap

Due to my schedule I was unable to trade the 21st to 23rd.


$NFLX posted earnings which sent the stock soaring up 9% to new all time highs and slightly more than 6x higher than it's lows from a year ago. In continuing with the "strangle pays" trend, a strangle off the open would have paid huge as the stock ended up finishing down 2% on the day for a net swing of 65 points.


F was out with earnings. The revenues were at record highs, but EPS had taken a hit due to employee costs. The stock was trading higher over the 18 level and I had considered some weekly 18 puts but didn't enter them. They opened for about .15 and hit a high of .35 a little before 11am.

$FFIV was out with earnings and had I thought to check the option strike interval I would have put on a strangle due to how it traded in the pre-mkt. Obviously the market was able to effectively price the new information. I thought FFIV only offered 85, 87.50, 90 strikes. I didn't realize there were dollar strikes for the weeklys. A 90 call/88 put strangle off the open would have cost about $2.00 and could have been sold end of day for about 3.50 or a 50% gain.

$JIVE had a boatload of Nov 12.5 calls BTO at about 0945 and I was thinking about jumping on board. I held off and they ended up ripping from about .60 to 1.20 on the day. It continued through the next day as the stock traded up and over 13.

$NQ had a report from short seller Muddy Water's released at about 1300hrs. The stock was trading around 20 and I had considered some Nov 18 and 15 puts for 2.90 and 1.50 respectively but thought the prospect of vol crush was too great so I held off. The stock ended up tanking on the day, hitting a low of about 8.75. The 18 puts more than quadrupled while the 15's quintupled before the stock was officially halted until Friday.


$AMZN I had considered a strangle off the open but was spoked by vol. The 355/365 strangle would have cost about 4.90 to put on and could have been flipped for about 7.20 within the 1st 5 minutes. A second strangle of 350/360 could have been put on for about $6.00 and flipped for $9.00 within the next 30 minutes.

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