November 2009 | Members

 

10:15am (EST)

Priceline.com (PCLN, $199.46, up $25.73)

November 200 calls (PNEKA, $5.00, up $3.50)

Entry Price:  $1.10 (11/6/09)
Exit Target: $2.00
Return: 355%
Stop Limit: None

Action:  Ring the register on half and place a stop at $4 on the calls…


Apollo Group (APOL, $55.88, flat)

December 50 puts (OAQXJ, $1.50, unchanged)

Entry Price:  $1.45 (11/5/09)
Exit Target: $2.00, raise to $2.90
Return: 3%
Stop Limit: 75 cents, raise to $1.00

Action:  Continue to hold. 

Yesterday, I said:  “The puts have traded to a high of $2.35 so we will raise our exit target to $2.90 which represents a 100% return.  Notice we raised the stop as well.”

I want to explain Exit Targets this morning since we have a lot of new faces.  When we give an Exit Target is just means that is our target and it doesn’t necessarily mean you have to exit the trade.  Also, yours truly kind of screwed up on this one when I listed the original Exit Target. 

Most of you know we target 100% returns while limiting losses to 50%.  Our original entry price was $1.45 so the Exit Target should have been $2.90 in the first place.  Some of you wrote to use and said you got out of the trade when the puts traded over $2.00.  Well, the trade was up nearly 30% when yesterday’s update went out and you can see the stock rebounded after our update which sent the puts back down.

These parameters are not etched in stone which means you can use loose stops or tight exit targets, or whatever YOU decide.  Please realize I do my best but sometimes it depends on where YOU want to exit a trade and what you feel comfortable with.

So, if you made a 30% profit and you are out of the trade then you did GREAT!  Don’t worry about missing trades and getting in a trade late.  Look, it happens but you shouldn’t force trades if you see them late and you shouldn’t beat yourself up if you made a profit.

Also, we realize many of you can’t watch the market but I’m trying my best to do trades ONLY in the 1pm update.  This way I can get a fair price on where an option is when I send the trade out.  If I do an update at 9am and list some options they may gap up or down at the open so I’m trying to keep everyone on the same page.

We know it is hard to follow us if you have a full-time job but there are ways around it.  If you don’t have a smartphone, go get one.  For $100/ month you can have access to the web and your trading account.  If you boss is biting your ear off, tell him you gotta use the restroom and go check your stock quotes.

You can also follow us on Twitter which will alert you as soon as we post on the website.  Please realize the Twitter post will not have the trade updates but it will let you know they are posted on the site. 

We also send the email out right before we post on the website so a smartphone will also alert you on when you have something in your inbox from us.  I try to post as close to 1pm as possible but sometimes I do post a little early.  Make sure you check the Special Notice just outside of the Members Area if you are not getting our emails everyday, twice a day.

Hopefully, this will help many of you keep up with us on a real-time basis and please know we are working hard to get you this information to you how you want it.  We are looking at some other things as well and please keep the comments and suggestions coming…

Dendreon (DNDN, $29.16, down $0.15)

January 35 calls (UQBAT, $1.50, unchanged)

Entry Price: $2.15 (10/15/09)
Exit Target: $5.00  
Return: -30%
Stop Limit: None

Action: Continue to hold.