Johnson & Johnson (JNJ, $71.13, up $0.68) is setting a new 52-week high today and has been solid since its earnings report. I mentioned good things could be in store for the company and the chance of the stock setting new 52-week highs was a good possibility if earnings were better-than-expected. We were stopped out of the August 65 calls (JNJHM, $6.20, up $0.70) at $3.80 on July 30 after staying in the trade for a couple of weeks because of the volatility. The trade was profiled at $2.30 so the return was 65%. As you can see, although we were stopped out, the calls went on to gain another 50%.

Research In Motion (RIMM, $126.58, up $4.60) is another position that we were whipsawed out of due to the market volatility. I profiled the September 140 calls (RULIH, $3.35, up $1.33) at $1.85 on July 31 and they immediately traded to a high of $2.70 shortly after. We then set a $2.00 stop which took us out of the trade as RIMM plunged below $116 Monday. Although the trade was good for 8% today’s action proves how nimble we have to be to maximize our profits. That’s the difference between 8% and nearly a 100% return. Incredible huh?

Rick Rouse