In a previous article, “Portfolio Management: Stock Insurance”, we explained how to insure a position or portfolio of positions against a large loss by using protective put options. In article, “January Effect – Part 2”, we explained the theory behind The January Effect. Basically, The January Effect is theorized to be a result of investors selling loser stocks in order to realize tax losses near the end of a year. After the loser stocks have been depressed from the tax loss selling and the selling of the loser stocks subsides, the prices of the stocks begin to recover after the start of a new year.
Category: Stock Option Trading News
CME Bull Put Spreads Strategy – Nice 5.8% in Ten Days
In a previous article, “CME Buying CBOT”, we analyzed Chicago Mercantile Exchange’s (CME) purchase of CBOT (BOT) and we illustrated the profitability of the covered call strategy for CME.In article, “CME Covered Call Strategy Returns +3.9% in Nov.”, we selected covered calls positions for CME once again for stock options expiration in January and we also selected bull put credit spreads positions for CME for expiation in December. The December bull put credit spreads selected for CME returned an average of +5.8% in just 10 days!
eBay – “Knee-How” to Covered Call Investing
EBay Inc. (EBAY) announcing a new website and joint venture with the Beijing-based Internet company, TOM Online Inc. Ebay’s new strategy differs from comments made by CEO Meg Whitman last year, when she described a $100M investment eBay was making in China at the time as “a sign of an unmistakable commitment and an unstoppable determination to be number one in China.”
Sewing Covered Calls Returns Nice +2.5% in Dec 06
In the article, “Sewing Up Profits – Covered Calls Investing”, we analyzed the retail fabric market and decided a covered calls stock options strategy was prudent for this segment in light of the popularity of hand made clothing by today’s teens. Two positions were selected for this strategy, and both were profitable returning an average of +2.5%. The Jo-Ann Stores (JAS) position returned the maximum profit of +3.1% and the A.C. Moore Arts & Crafts (ACMR) position returned +1.9%.
SimpleTech (STEC) – Simply Covered Call Profits
SimpleTech Inc. (STEC), a manufacturer of memory chips, increased its fourth-quarter earnings outlook. News sent shares sailing upward over 7 percent in pre-market trading. The company said its consumer and OEM divisions are performing more strongly than expected. SimpleTech reported earnings of around 18 cents per share, on sales of over $10 million, in the fourth quarter. Earlier guidance pinned earnings at around 16 cents per share on sales of around $95 million. Analysts average estimates agreed with the earlier guidance supplied by the company.
Covered Call Profits – Maybe Not Faro Off
Faro Technologies Inc. (FARO) announced Tuesday the principle claims in a patent lawsuit filed by its largest competitor, Swedish firm Hexagon AB’s subsidiary Romer-CimCore, were rejected by the U.S. Patent Office.If the patent rejection stands it will cause Faro to prevail in the ongoing litigation. The lawsuit was filed in 2003 and concerns a disagreement over a 3D machine rotation product manufactured by Hexagon subsidiary Romer-CimCore in San Diego, Calififornia.
Coach (COH) Bagging Profits in China
Coach Inc. (COH), the well-known high-end handbag maker, said 15 November it is looking to China for overseas growth while expanding in its main Japanese and American markets. China is currently experiencing well-documented growth. It is estimated Chinese construction companies are building the equivalent of Houston or Philadelphia every month.
CME Covered Call Strategy Returns +3.9% in Nov.
In a previous article, “CME Buying CBOT“, we analyzed CME’s purchase of CBOT and we used PowerOptions stock options search tools to find some potentially lucrative covered calls stock options investments with stock options expiring in November of 2006. Every single position selected returned the maximum potential return for an average return of +3.9%, in just 32 days!
2%-12% Returns In Less Than 1 Month
PowerOptions weblog identified several successful trades for the option expiration month of November. Below is a table showing some of the successful trades identified with a link to the corresponding article.
Generic Drug Investing Returns +1.3% in Nov.
In blog article, “Wal-Mart – Generic Drugs – Options Investing“, we analyzed the generic drug industry in view of Wal-Mart’s introduction of $4 generic drugs. Using PowerOptions’ SmartSearchXL stock options search tool, we discovered three attractive generic drug covered calls stock options positions. The selected covered calls positions returned an average of +1.3% at options expiration in November of 2006.