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Tuesday, April 26, 2011

Playing the mutually exclusive advantage : $SPX $IWM

Option Delta: An underlying stock has a delta of 100 & at the money call & put's delta add up to 100. Holding an at the money covered call the reduces the delta of the position by about 50% and hence is able to hedge partially  in to a risk reduced position

But if you are confident of the markets direction, you can enhance your profits by adding a put sell to the above trade. The beauty is in the fact that it's mutually exclusive but still is able to bring the delta back to 100 since it cancels out the delta of the sold covered call.

As long as the position is active it cancels the hedge for the sold call but at expiry plays to your advantage since only one of the two contracts gets assigned. This can be played to the advantage of doubling your total profits even when reducing your position size by half. This can then be classified as risk management at its best and works very well when the option strikes are $1 apart. This strategy can be used to capture monthly return on investment of about 20-25% on a give position essentially doubling your investment capital in a period of 4-6 months.





Sunday, April 24, 2011

Weekly Trending Stocks : April 24th

Upate from last week
Exit :  holx, fcfs, stl, puls, gtiv
Hold : tyl, pdc, trad ( stock shot up due to buyout ), eig, io, amsf
Exit - hit price target : 
hs, lfus, hott


New Stocks
Trend pullback to 50 DMA : cenx, tti, baby, orb, rtek
Volume buzzers : infa, wor, pten, vrtx, liz, smp



FinViz Charts :
Pullback :  http://tinyurl.com/3vxve5m
Volume :  
http://tinyurl.com/3vvy5le

Sunday, April 17, 2011

Weekly Trending Stocks : April 17th

Upate from last week
Exit : cvg, hnt, lpnt, hway, ahs, asgn,
Hold : holx, fcfs, hs, lfus, hott
Exit - hit price target : oih

New Stocks
Trend pullback to 50 DMA : puls, eig, gtiv, io, amsf
Volume buzzers : pdc, hott, stl, tyl, hain, trad



FinViz Charts :
Pullback :  http://tinyurl.com/3bexcuc
Volume :http://tinyurl.com/3sgmfo6



Sunday, April 10, 2011

Weekly Trending Stocks : April 10th

Update from last week
Exit : avav, faf, skyw, puls these have broken down
Exit : geo, kamn, io,   these have hit price targets
Hold : npbc, prft

New Stocks
Trend pullback to 50 DMA :cvg, holx, hnt, lpnt, avid, hway
Volume buzzers : hott, ahs, asgn, ois, fcfs, hs, lfus

FinViz Charts :
Pullback :
http://tinyurl.com/3jnhmvf
Volume : http://tinyurl.com/3hp6wfx

Sunday, April 3, 2011

Weekly Trending Stocks : April 3rd



Update from last week : 
All stocks are holding well, GRB has hit the target and should be sold, all volume buzzers have broken out well. Please move you stop to break even. Trend pull back stocks didn't move much are still basing.


New Stocks
Trend pullback to 50 DMA : skyw, gtiv, avav, faf, ment, ohi
Volume buzzers : puls
, cibr, trst, ssys, io, geo, kamn, npbc, prft

FinViz Charts :

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