9:10am (EST)

Vale SA (VALE, $25.70, up $1.72)

June 22 puts (VALE100619P00022000, $0.45, down $0.50)

Entry Price:  $1.00 (5/20/10)

Exit Target: $2.00

Return: -55%

Stop Target: 50 cents

Action:  We were on the edge with this one on Friday because we normally don’t carry stops on options under $1.00.  However, our entry price was a buck so we listed the 50 cent stop.  We mentioned that we may get “caught” with a few trades but you still have to push the envelope if you really want to hit the homeruns every now and then.

We could be totally wrong but the 40% tax Australia has put on the mining companies will force a number of companies to look at their current projects while many put future plans on hold.  Throw in the fact that Australia’s Dollar is tanking… 




Australian dollar chart




PowerShares QQQ (QQQQ, $44.84, up $0.49)  

June 45 puts (QQQQ100619P00045000, $1.90, down $0.40)

Entry Price:  $1.15 (5/17/10)

Exit Target: $2.30 (closed half at $1.90 on 5/20/2010)    

Return: 65%

Stop Target: 65 cents, raise to $1.00  

Action:  We raised the stop in case the market does bounce and we will likely take profits if hit.  We don’t want to make this a HARD STOP just yet until we see how the market opens.   

Expedia (EXPE, $21.78, up $0.11)

June 20 puts (EXPE100619P00020000, $0.65, down $0.10)

Entry Price:  $0.45 (5/14/10)

Exit Target: $1.00 (closed half at $0.90 on 5/21/2010)       

Return: 75%

Stop Target: None, set one at 45 cents 

Action:  Same deal with the stop here and continue to hold.     

SanDisk (SNDK, $41.48, up $1.82)

July 34 puts (SNDK100717P00034000, $1.80, down $0.50)

Entry Price:  $1.50 (5/10/10) 

Exit Target: $3.00

Return: 20%

Stop Target:  $1.10

Action:  We are hoping for a drop back below $40 and a test of the May 6-7 lows of $34-$35.   

Qualcomm (QCOM, $35.89, up $0.30)

June 36 puts (AAO100619P00036000, $1.60, down $0.30)

Entry Price:  $0.80 (4/28/10) 

Exit Target: $2.00+ (closed half at $1.80 on 5/7/2010) 

Return: 113%

Stop Target: $1.00 (HARD STOP)

Action:  Make the $1.00 a HARD STOP. 

Other 2010 Portfolio OPEN positions (5):  These are trades that are still open in the portfolio that have longer expiration dates or are on “hold” but are not worth mentioning until they turn around.  Many of these trades are months old so new subscribers should not be in them. 

We are still keeping track of the trade and we will record the results, accordingly, when we close them or they expire.  Click on the 2010 Portfolio link in the Members Area to view ALL open/ closed trades. 

A123 Systems and Berkshire Hathaway Class B.


These trades are NOT recommendations until we send out an alert.  These are trades that we like but have not added to the portfolio as an official recommendation because of market conditions or because we are waiting for better entry prices.  We will not list entry prices because these stocks are on the verge of breaking out or they could selloff.  

Rambus (RMBS, $24.20, up $1.05)

June 28 calls (RMBS100619C00028000, $1.60, up $0.40)

June 20 puts (RMBS100619P00020000, $1.50, down $0.10)

Action:  Rambus is expecting to hear good news on some legal issues over the next few weeks in their patent cases against Nvidia (NVDA, $12.73, up $0.27) and Hynix/Micron (MU, $8.93, up $0.19).  The only thing that will probably keep us on the sidelines is the high premium these options are commanding.

Green Mountain Coffee Roasters (GMCR, $23.32, up $0.26)

September 30 calls (GMCR100918C00030000, $0.97, down $0.01)

Action:  Let’s just “track” these options as we get a feel on how shares trade after the recent 3-for-1 split.

Bucy International (BUCY, $50.06, up $2.69)

July 45 puts (BUCY100717P00045000, $3.41, down $0.76)

July 55 calls (BUCY100717C00055000, $3.10, up $0.40)

Action:  If other governments decide to tax the mining companies then this Wall Street darling could fall further.  Shares were at $70 in mid-April and have got punished during the recent pullback.  We think there could be another 10 points to the upside on a bounce or 10 to the downside on a test to support.  We are tracking these options because the premium is a bit rich as we don’t like paying over $2 for any options.

As a strangle option trade we would want to see a quick rally up to $55 where the calls would double and we would close them.  That would make it nearly a risk free trade then a sharp reversal back to $45 for the gravy.

TiVo (TIVO, $9.03, up $0.19)

August 15 calls (TIVO100821C00015000, $0.22, flat)

August 7.5 puts (TIVO100821P00007500, $0.75, down $0.05)

Action:  We profiled this strangle trade last Tuesday when the calls were at 52 cents and the puts were at 49 cents.  As you can see, together, the premiums are still around a buck. 

For those of you who may have taken the trade, it would be awesome if TiVo announces earnings that disappoint Wall Street this week and shares tank.  That would get the puts to over a buck where you could close the position.  This would allow you to have a risk free trade in the calls until August with the chance to participate in any legal victories.


Moody’s (MCO, $22.02, up $0.81)

June 17.50 puts (MCO100619P00017500, $0.65, down $0.25)

Action:  If Moody’s rallies to $25-$25 then we may get back into the June 20 puts as we don’t want to be too far out-of-the-money.


Dendreon (DNDN, $41.70, up $0.79)

August 60 calls (DNDN100821C00060000, $1.35, up $0.20)

Action:  We are thisclose to releasing this trade today.  We may just play it for the week but we don’t like the fact that the market is closed next Monday for Memorial Day which will zap some time premium.  However, Dendreon could surge past $50 again over the next few weeks as the ASCO gets underway.