December 2010 | Members

 

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.

 

12:50pm (EST)

FedEx (FDX, $95.13, up $1.14)

January 100 calls (FDX110122C00100000, $1.95, up $0.25)

Entry Price:  $1.25 (11/30/10)

Exit Target: $2.00-$2.50 (closed half @ $2.15 on 12/2/10)

Return: 64%

Stop Target: $1.00, raise to $1.50 

Action:  Shares have reached a high of $96.23 today.  Continue to hold the other half.     

 

Foster Wheeler (FWLT, $30.05, up $0.81)

January 30 calls (FWLT110122C00030000, $1.80, up $0.40)

Entry Price:  $1.00 (11/30/10)

Exit Target: $2.00+ (closed half @ $1.90 on 12/2/10)

Return: 85%

Stop Target: $1.00 (HARD STOP on other half)

Action:  We closed half on strength today.  Continue to hold the other half.

 

Electronic Arts (ERTS, $15.08, up $0.03)

March 20 calls (ERTS110319C00020000, $0.22, flat)

Entry Price:  $0.22 (11/24/10)

Exit Target: $0.50+

Return: 0%

Stop Target: None

Action:  Continue to hold.


JDS Uniphase (JDSU, $12.54, up $0.41)

March 12 calls (JDSU110319C00012000, $1.45, up $0.20)

Entry Price:  $1.25 (11/19/10)

Exit Target: $2.50

Return:  16%

Stop Target: 60 cents

Action:  The 52-week high is $13.95 and we have nearly 4 months to wait for a run to $15.  Continue to hold.


Juniper Networks (JNPR, $34.82, down $0.12)

January 35 calls (JNPR110122C00035000, $1.70, down $0.10)

Entry Price:  $1.30 (11/17/10)

Exit Target: $2.60

Return: 31%

Stop Target: $1.00 

Action:  Close HALF at current levels.  We just don’t like the way shares are acting today.  Continue to hold the other half.


Riverbed Technology (RVBD, $34.44, up $0.17)

March 35 calls (RVBD110319C00035000, $3.80, flat)

Entry Price:  $1.40 (11/17/10)

Exit Target: $2.80 (closed half @ $3.00 on 11/23/10)

Return: 143%

Stop Target:  $2.70 (HARD STOP on other half) 

Action:  Continue to hold.


CBOE Holdings (CBOE, $24.31, up $0.40)

December 25 calls (CBOE101218C00025000, $0.40, up $0.05) 

Entry Price:  $0.75 (11/8/10)

Exit Target: $2.40+

Return: -47%

Stop Target: None

Action:  Continue to hold.


Darden Restaurants (DRI, $50.23, up $0.91)

December 49 calls (DRI101218C00049000, $1.85, up $0.50) 

Entry Price:  $1.20 (11/8/10)

Exit Target: $2.40+ (closed half @ $1.80 on 12/1/10)

Return:  54%

Stop Target: $1.25

Action:  We would love to see a close above $50 so that we can close the other half into strength.  We would close it today because they are December options but we are going to push the other half for a day.  Continue to hold.


Aruba Networks (ARUN, $22.94, up $0.02)

January 25 calls (ARUN110122C00025000, $1.00, flat)

Entry Price:  $1.20 (11/2/10)

Exit Target: $2.40+

Return: -17%

Stop Target:  Close the trade is shares fall below $20

Action:  Continue to hold.


PowerShares QQQ (QQQQ, $53.67, up $0.48)

January 53 calls (QQQQ110122C00053000, $1.90, up $0.20)

Entry Price:  $1.54 (10/27/10)

Exit Target: $3.00+

Return: 23%

Stop Target: 75 cents

Action:  Continue to hold.


American Tower (AMT, $51.92, up $0.89)

April (2011) 60 calls (AMT110416C00060000, $0.65, up $0.10)

Entry Price:  $0.65 (10/20/10)

Exit Target: $1.30+

Return:  0%

Stop Target: None


Action:  Continue to hold.


Dendreon (DNDN, $38.06, up $0.50) (COVERED CALL)

December 40 call (DNDN101218C00040000, $0.45, up $0.10)

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: -2%

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.

CurrencyShares Euro Trust (FXE, $131.64, up $0.77)

January 125 puts (FXE110122P00125000, $0.85, down $0.20)

Action:  Shares are setting up nicely for us to get into this trade.  Continue to watch for now.


Skyworks Solutions (SWKS, $26.88, up $0.40)

January 26 calls (SWKS110122C00026000, $2.05, up $0.25)

Action:  These options have nearly doubled since we profiled them.  If you are in, close half.  We will continue to watch.  


THQ (THQI, $5.36, down $0.07)

March 5 calls (THQI110319C00005000, $1.00, down $0.05)

Action:  Continue to watch.


Ingersoll-Rand (IR, $42.38, up $1.28)

January 42.50 calls (IR110122C00042500, $1.55, up $0.10)

Action:  IR was recently added to the S&P 500 and we think shares can rally to $45 by mid-January.  Watch for now.

 

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10:50am (EST)

FedEx (FDX, $95.71, up $1.72)

January 100 calls (FDX110122C00100000, $2.15, up $0.45)

Entry Price:  $1.25 (11/30/10)

Exit Target: $2.00-$2.50

Return: 72%

Stop Target: $1.00 

Action:  Close HALF of the trade at current levels.  Folks, we have made over 70% in two days and we just don’t want to give up those gains.  Our goal is to always make 100% or more with each trade and we are close.  However, we don’t want to get greedy and we want to protect profits.  Continue to hold the other half.


Foster Wheeler (FWLT, $30.31, up $1.07)

January 30 calls (FWLT110122C00030000, $1.90, up $0.90)

Entry Price:  $1.00 (11/30/10)

Exit Target: $2.00+

Return: 90%

Stop Target: None

Action:  We got our break over $30.  Close HALF of the trade at current levels.  Same deal here as far as making 90% in two days and protecting profits.  Continue to hold the other half.

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9:00am (EST)

FedEx (FDX, $93.99, up $2.87)

January 100 calls (FDX110122C00100000, $1.70, up $0.60)

Entry Price:  $1.25 (11/30/10)

Exit Target: $2.00-$2.50

Return: 36%

Stop Target: 60 cents, raise to $1.00 

Action:  Shares reached a high of $95 yesterday while the options traded up to $1.97.  Continue to hold.      

 

Foster Wheeler (FWLT, $29.24, up $1.24)

January 30 calls (FWLT110122C00030000, $1.40, up $0.45)

Entry Price:  $1.00 (11/30/10)

Exit Target: $2.00+

Return: 40%

Stop Target: None

Action:  Foster Wheeler made a high of $29.54 yesterday and the calls traded up to $1.49.

There is strong resistance at $30 but a break above it will easily get shares to $32.  There is a chance shares can break the 52-week high of $35 if we get a run past $32 but let’s focus on $30, first.  Continue to hold.

 

Electronic Arts (ERTS, $15.05, up $0.14)

March 20 calls (ERTS110319C00020000, $0.22, flat)

Entry Price:  $0.22 (11/24/10)

Exit Target: $0.50+

Return: 0%

Stop Target: None

Action:  Continue to hold.


JDS Uniphase (JDSU, $12.13, up $0.26)

March 12 calls (JDSU110319C00012000, $1.25, up $0.15)

Entry Price:  $1.25 (11/19/10)

Exit Target: $2.50

Return:  0%

Stop Target: 60 cents

Action:  The 52-week high is $13.95 and we have nearly 4 months to wait for a run to $15.  Continue to hold.


Juniper Networks (JNPR, $34.84, up $0.32)

January 35 calls (JNPR110122C00035000, $1.70, up $0.30)

Entry Price:  $1.30 (11/17/10)

Exit Target: $2.60

Return: 31%

Stop Target: $1.00 

Action:  We are looking for shares to rebound back towards $36, and if cleared, should pave the way for a run to $40.  Continue to hold.


Riverbed Technology (RVBD, $34.27, up $0.34)

March 35 calls (RVBD110319C00035000, $3.80, up $0.20)

Entry Price:  $1.40 (11/17/10)

Exit Target: $2.80 (closed half @ $3.00 on 11/23/10)

Return: 143%

Stop Target:  $2.70 (HARD STOP on other half) 

Action:  Continue to hold.


CBOE Holdings (CBOE, $23.91, up $0.22)

December 25 calls (CBOE101218C00025000, $0.35, flat) 

Entry Price:  $0.75 (11/8/10)

Exit Target: $2.40+

Return: -53%

Stop Target: None

Action:  Continue to hold.


Darden Restaurants (DRI, $49.32, up $0.37)

December 49 calls (DRI101218C00049000, $1.35, up $0.10) 

Entry Price:  $1.20 (11/8/10)

Exit Target: $2.40+ (closed half @ $1.80 on 12/1/10)

Return:  33%

Stop Target: $1.25

Action:  We got our break above $50 as shares touched a high of $50.24 while the options traded to a high of $1.84.  We used the strength to close half of the trade in case shares struggle from here on out.  These are December options that expire in a couple of weeks so we wanted to play it safe.  The options are only 32 cents in-the-money which shows you the options have a $1 time premium built in to the current price.  This will start to evaporate as the options come closer to expiring.  Continue to hold the other half but be on the lookout for a Trade Alert if we close the trade.


Aruba Networks (ARUN, $22.91, up $1.67)

January 25 calls (ARUN110122C00025000, $1.00, up $0.40)

Entry Price:  $1.20 (11/2/10)

Exit Target: $2.40+

Return: -17%

Stop Target:  Close the trade is shares fall below $20

Action:  Aruba surged 8% yesterday.  Continue to hold.


PowerShares QQQ (QQQQ, $53.19, up $1.11)

January 53 calls (QQQQ110122C00053000, $1.70, up $0.45)

Entry Price:  $1.54 (10/27/10)

Exit Target: $3.00+

Return: 10%

Stop Target: 75 cents

Action:  Continue to hold.


American Tower (AMT, $51.03, up $0.46)

April (2011) 60 calls (AMT110416C00060000, $0.55, flat)

Entry Price:  $0.65 (10/20/10)

Exit Target: $1.30+

Return:  -15%

Stop Target: None

Action:  Continue to hold.


Dendreon (DNDN, $37.56, up $1.98) (COVERED CALL)

December 40 call (DNDN101218C00040000, $0.35, up $0.18)

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: -3%

Stop Target: None

Action:  Shares seem to bounce off the $35-$36 level before making a run at $40.  The chart clearly shows the tight range we have been in since August which is exactly what we like to see when doing covered call trades.  The longer shares stay in this range, the bigger the breakout (or breakdown) will be.  We think Dendreon can hit $60 in 2011 as they get their manufacturing plants up to full speed.

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.


CurrencyShares Euro Trust (FXE, $130.87, up $1.57)

January 125 puts (FXE110122P00125000, $1.05, down $0.40)

Action:  Shares will have to close below $130 for a few days before we consider adding this trade.  Continue to watch for now.


Skyworks Solutions (SWKS, $26.48, up $1.03)

January 26 calls (SWKS110122C00026000, $1.80, up $0.50)

Action:  Continue to watch.  


THQ (THQI, $5.43, up $0.35)

March 5 calls (THQI110319C00005000, $1.05, up $0.40)

Action:  We had a feeling THQ would be on the move.  Shares surged to a high of $5.71 as their UDraw for Wii seems to be a hit.


Ingersoll-Rand (IR, $42.10, up $1.10)

January 42.50 calls (IR110122C00042500, $1.45, up $0.45)

Action:  IR was recently added to the S&P 500 and we think shares can rally to $45 by mid-January.  Watch for now.