Today's trade is in household name that is emerging from a 3-year base and on the verge of new all-time highs.
Due to earnings on the horizon, we'll be utilizing a spread to keep our costs in check and take advantage of some relative high options premium in out-of-the-money calls.
The stock has had a strong runup in recent weeks. Some traders have a hard time buying stocks making highs.
I don't.
But with implied volatility relatively cheap right now in this stock, an earnings event on the horizon, and a potential "two-hundred-dollar-roll" looming ahead, this feels like the right time to take a defined risk shot.
As I've discussed recently, earnings season is quickly approaching. And with it comes risks and opportunities.
For today's trade, I'm going to leverage elevated options premiums in a nearby expiration to get a better net cost on the real call options I'd like to own.
And I'm taking advantage of a recent pullback to get in at attractive prices and a nearby exit if I'm wrong.
As an owner of a gas-guzzling SUV, I don't like the prospect of higher oil prices.
Nobody enjoys paying more at the pump. It's an unavoidable tax and if it gets too high, it can be a real drag on people's finances, and can even spill over into broader consumer spending.
And it certainly can be an inflationary signal for all things we spend money on.
That said, in a small way, I'm going to look to hedge myself against gas inflation by getting involved in a popular filling station operator that will ease my mind if I keep paying more to drive my car.
We've seen a bit of a rise in volatility this week, and while it is not something that should be ignored or scoffed at, I do think it offers us options traders an opportunity to position for some volatility mean-reversion, especially in some big-cap names that are stuck in ranges, ideally tightening ones.
Today's trade is in a well-known name that already has earnings out of the way and fits the bill for some continued sideways action.
"We should be doing more in China." ~ JC Parets during this morning's internal Analyst meeting.
This, coupled with my feeling that we need to be more aggressive in the stock market right now as the potential profits on the upside could be quite meaningful, playing in China is as aggressive as it gets.
At Portfolio Accelerator today, Uber was a name that was getting everybody excited. It looks like it's setting up for another run to and through all-time highs.
The trade today is in a company that actually makes money, minting coins. You know, the coins you drop in the pinball machine.
So, no matter how you think about it, the fundamentalists cannot say that this company does not make money. It always makes money.
Fun and word games aside, we've got a trade that has signaled the next big move and today's trading action is offering us a nice pullback in which to get involved at better prices.