Please remember, ALL “Exit Targets” and “Stop Targets” are targets. You should not have any “Hard Stops” entered to close any trades or “Exit Orders” in your brokerage account unless we list one. We will send out an “Alert” or “Trade Update” if we want you to close a position OR if a new trade comes out. Otherwise, follow instructions at all times in the 9am and 1pm updates. Also, we will usually give you a heads-up if we think we are going to send an email outside of these time frames but it is rare that we do.
9:15am (EST)
Electronic Arts (ERTS, $14.98, up $0.13)
March 20 calls (ERTS110319C00020000, $0.21, down $0.01)
Entry Price: $0.22 (11/24/10)
Exit Target: $0.50+
Return: -5%
Stop Target: None
Action: Shares of EA are near 52-week lows and we think they have found a bottom. There is a little buzz back in the Gaming industry and EA is a powerhouse. The company is well-positioned for the growing popularity of online play and is a likely takeover candidate. The stock is cheap at current levels.
JDS Uniphase (JDSU, $12.20, up $0.21)
March 12 calls (JDSU110319C00012000, $1.30, up $0.10)
Entry Price: $1.25 (11/19/10)
Exit Target: $2.50
Return: 4%
Stop Target: 60 cents
Action: We are looking for shares to clear $12.50 which could lead to a run at $13-$14 over the short-term. Continue to hold.
Juniper Networks (JNPR, $34.51, up $1.03)
January 35 calls (JNPR110122C00035000, $1.65, up $0.40)
Entry Price: $1.30 (11/17/10)
Exit Target: $2.60
Return: 27%
Stop Target: $1.00
Action: If shares can clear $36, the 52-week high, then we could see a run to $40. Continue to hold.
Riverbed Technology (RVBD, $34.75, up $1.14)
March 35 calls (RVBD110319C00035000, $3.90, up $0.50)
Entry Price: $1.40 (11/17/10)
Exit Target: $2.80 (closed half @ $3.00 on 11/23/10)
Return: 146%
Stop Target: $2.10, raise to $2.50
Action: Riverbed hit another new high of $35.32 on Wednesday and the options traded up to $4.20. Continue to hold.
CBOE Holdings (CBOE, $23.88, down $0.81)
December 25 calls (CBOE101218C00025000, $0.40, down $0.30)
Entry Price: $0.75 (11/8/10)
Exit Target: $2.40+
Return: -47%
Stop Target: None
Action: We mentioned CBOE was tendering shares on Wednesday and back in mid-October they offered to buy up to $300 million from former members. This was a slight overhang on the shares and we should see a strong rebound as business is up on the CBOE and estimates are being raised.
Darden Restaurants (DRI, $49.68, up $0.53)
December 49 calls (DRI101218C00049000, $1.70, up $0.25)
Entry Price: $1.20 (11/8/10)
Exit Target: $2.40+
Return: 42%
Stop Target: $1.25
Action: Shares hit a high of $49.99 on Wednesday. We are looking for a break above $50 and a possible run to $55. Continue to hold.
Aruba Networks (ARUN, $23.82, up $0.56)
January 25 calls (ARUN110122C00025000, $1.35, up $0.15)
Entry Price: $1.20 (11/2/10)
Exit Target: $2.40+
Return: 13%
Stop Target: 60 cents
Action: The 52-week high is $24.28 which was set on Monday. Continue to hold.
PowerShares QQQ (QQQQ, $53.12, up $1.05)
January 53 calls (QQQQ110122C00053000, $1.60, up $0.45)
Entry Price: $1.54 (10/27/10)
Exit Target: $3.00+
Return: 4%
Stop Target: 75 cents
Action: If the Nasdaq can break 2,600, the Q’s should run past $55. Continue to hold.
American Tower (AMT, $52.04, up $0.89)
April (2011) 60 calls (AMT110416C00060000, $0.70, up $0.10)
Entry Price: $0.65 (10/20/10)
Exit Target: $1.30+
Return: 8%
Stop Target: None
Action: Continue to hold.
Dendreon (DNDN, $36.77, up $0.88) (COVERED CALL)
December 40 call (DNDN101218C00040000, $0.35, up $0.05)
Entry Price: $41.96 (9/13/10) sold October 45 call @ $1.30, (11/11/10) sold December call @$1.75
Exit Target: $45
Return: -6%
Stop Target: None
Action: Dendreon opened at $41.96 and you could have sold the October 45 call option for $1.30 on 9/13/10. This lowered the cost basis to $40.66.
On 11/11/10 we sold the December 40 call option for $1.75 which lowered our cost basis to $38.91. If the stock gets “called away” from us by mid-December then we make 3% in 3 months.
Other 2010 Portfolio OPEN positions (2): 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. We are still keeping track of the trade and we will record the results, accordingly, when we close them or the options expire. Click on the 2010 Portfolio link in the Members Area to view ALL open/ closed trades.
Biodel March 7.50 calls (from October)
Chesapeake Energy January 25 calls (from October)
WATCH LIST SECTION
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 sell-off.
Regeneron (REGN, $29.37, down $0.62)
December 32 calls (REGN101218C00032000, $0.55, down $0.20)
Action: Watch for now.
Skyworks Solutions (SWKS, $26.14, up $1.38)
January 26 calls (SWKS110122C00026000, $1.65, up $0.50)
Action: Shares surged over 5% Wednesday and these calls opened at $1.15.
THQ (THQI, $5.01, up $0.09)
December 5 calls (THQI101218C00005000, $0.30, flat)
March 5 calls (THQI110319C00005000, $0.70, up $0.10)
Action: Continue to watch.
Cisco Systems (CSCO, $19.46, up $0.26)
Action: We are looking at Cisco as a covered call trade. Shares could test $17.50-$18 which is where we are looking to establish positions.
Foster Wheeler (FWLT, $28.83, up $1.08)
January 30 calls (FWLT110122C00030000, $1.25, up $0.35)
Action: These options opened at $1.05 on Wednesday. Continue to watch.
Ingersoll-Rand (IR, $41.13, up $0.97)
January 42.50 calls (IR110122C00042500, $1.00, up $0.20)
Action: Watch for now.
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