Archive for the ‘calls’ Category

Sunday, April 20th, 2008

Crazy, but towards the end of the day Friday Google’s April 500 strike call option was up 10,000% from the previous day’s price. That’s what I love about options, you can have incredible leverage in such a short amount of time.

I was wondering if I had held these options and had trouble selling them because it was the day before options expiration and was “stuck” holding onto these my understanding is that my broker would automatically exercise these options for me instead of letting the contracts go worthless. Great. However, if I didn’t have the capital in my account to purchase all of the stock that I had the right to, would that still happen then and they’d just immediately buy then sell them at market price come Monday morning? Or would they just let them expire since I didn’t have the capital to exercise them fully?  I believe the former action is what should take place (they’d exercise and then immediately sell them for me)

Thursday, December 20th, 2007

RIMM’s up 15% after hours after posting earnings. This morning I bought some Jan 130 calls just because

  1. I liked how the market responded to Oracle’s earnings yesterday and that instills confidence that the tech sector is still strong
  2. The VIX is dropping which means a more saner market ahead of us
  3. And, well, despite my better judgment, it just felt good, and I still love my Blackberry

I’m hoping I will have doubled my money by tomorrow morning. This is one of my favorite stocks to trade.

… The next day …

I sold out early this morning for a 54% gain when the stock was hovering around $117, but, hey, it was a one-day gain and in this wacky market I’ll take what I get. The stock’s at $119 now 2 hrs before market close which would have given me a 100% gain on the options but I’m OK with it. I think with volatility dropping though I would be more apt to hang on longer and not be so trigger happy.  In retrospect I should have just put a trailing stop on it to protect my profits while letting it run, but I’m not too familiar with that feature on optionsXpress yet but that’s something to study up on over the weekend.