September 2009 | Members

9:00am (EST)

ChangeYou (CYOU, $38.30, down $1.54) 

October 42 calls (CQUJP, $0.70, up $0.45)

Entry Price: $0.85 (9/21/09) 

Exit Target: CLOSED (closed half @ $1.30 on 9/23, closed other half @ $0.70 on 9/24)

Return: 18%
Stop: $0.70

Action:  This is the difference between 50% and 18%.  The call options opened at $1.40 but the stock went south at 10am along with the rest of the market.  This was your clue to close the trade and most of you did yesterday anyway.  The 70 cent stop was hit as a result but we will keep this one on the Watch List.

Citigroup (C, $4.43, down $0.09)

January 7.50 calls (CAQ, $0.11, flat) 

Entry Price: $0.32 (8/28/09)

Exit Target: $0.64

Return: -66%
Stop:  None  

January (2011) 10 calls (VRNAB, $0.39, down $0.02)

Entry Price: $0.60 (8/28/09) 

Exit Target: $1.20

Return: -35%
Stop: None

Action:  Continue to hold.

Dendreon (DNDN, $26.90, down $1.37)

November 45 calls (UQBKO, $0.20, down $0.43)

Entry Price: $0.30 (8/31/09) 

Exit Target: CLOSED (closed half at 50 cents on 9/15, closed other half @ $0.30 on 9/24)
Return: 33%
Stop: 30 cents 

Action:  As you can see, stops are key to protecting profits which is why we have them.  Dendreon said a lot of good things in their conference call and the shares should have went the other way but I told you we could have been setting up for a “sell the news” reaction. 

The stock was trading lower before the bell as the news started coming out and the calls opened at 46 cents.  They never made it higher than that the rest of the day.  I will provide another in-depth update over the weekend on Dendreon and there will come a time where we can play this one again. 

Moody’s (MCO, $19.58, down $0.91)

October 17.50 puts (MCOVW, $0.65, up $0.20)

Entry Price: $0.75 (9/24/09) 

Exit Target: $1.00-$1.25

Return: -13%
Stop: 30 cents 

Action:  Our latest edition to the portfolio.  We are looking for a drop to $18 or below…

Imax (IMAX, $8.72, down $0.28)

March 2010 12.50 calls (IMQCV, $0.25, down $0.05)

Entry Price: $0.45 (8/10/09)
Exit Target: $1.00+
Return: -44%
Stop: None 

Action: Continue to hold. 

Research In Motion (RIMM, $83.06, down $2.71)

October 100 calls (RULJT, $0.78, down $0.24)

Entry Price: $1.00 (9/17/09)
Exit Target: $1.50-$2.00 (closed half at $1.75 on 9/24)
Return: 25%

Stop: 50 cents

Action:  RIMM got smashed in after-hours last night and the other half of this trade is going to tank when we open.  Shares were down $11 to $72 in pre-market trading and the calls will easily hit the 50 cents stop once they open.  Depending on where the options open, this position will probably show a small loss. 

RIMM missed estimates AND offered lowered guidance that didn’t impress Wall Street.  Basically it means Apple’s market share is growing.  Some of you may wish to keep the other half open because the options still have 3 weeks left but take what you can get for them at the open because the momentum in this stock just got ruined.

Sirius XM (SIRI, $0.64, down $0.03)

December 1 calls (QXOLA, $0.05, flat)

Entry Price: $0.15 (8/21/09)
Exit Target: $0.30
Return: -67%
Stop: None 

Action:  Continue to hold.