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.

12:40pm (EST)

THQ (THQI, $5.75, up $0.14)

June 6 calls (THQI110618C00006000, $0.90, up $0.05)

Entry Price:  $0.75 (12/8/10)

Exit Target: $2.00

Return: 20%

Stop Target: None

Action:  From this morning:

“This may be a boring trade so we want to get that out of the way.  However, there are three catalysts that should get the momentum in this stock really going.

First, there is the company’s uDraw which looks like a big hit and second, the company has a sweet new game coming out in March called Homefront.  Early reviews are that it is “the game” to beat in 2011.  Third, they remain an acquisition target. 

The options have over 6 months to work in our favor and it is an easy trade to hold over the holidays and into next year.”


Foster Wheeler (FWLT, $32.58, up $0.93)

January 30 calls (FWLT110122C00030000, $3.30, up $0.50)

Entry Price:  $1.00 (11/30/10)

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

Return: 170%

Stop Target: $2.00 

Action:  Shares are up 3% again today and these options have another 43 days to go before expiration.  We are looking for shares to trade up to $35 by then.  Continue to hold the other half.   

 

Electronic Arts (ERTS, $15.80, up $0.05)

March 20 calls (ERTS110319C00020000, $0.25, up $0.03)

Entry Price:  $0.22 (11/24/10)

Exit Target: $0.50+

Return: 14%

Stop Target: None

Action:  Continue to hold.


JDS Uniphase (JDSU, $13.25, up $0.25)

March 12 calls (JDSU110319C00012000, $1.85, up $0.15) 

Entry Price:  $1.25 (11/19/10)

Exit Target: $2.50

Return:  48%

Stop Target: $1.25

Action:  We have a $15 price target for JDSU which will get these options to $3+.  Continue to hold.


Riverbed Technology (RVBD, $35.01, up $0.05)

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:  $3.20 (HARD STOP on other half) 

Action:  Continue to hold the other half.


CBOE Holdings (CBOE, $23.88, down $0.35)

December 25 calls (CBOE101218C00025000, $0.15, down $0.10) 

Entry Price:  $0.75 (11/8/10)

Exit Target: $2.40+

Return: -80%

Stop Target: None

Action:  We are closing this trade today to save a little premium.  We like the long-term prospects for CBOE but $25 will be huge resistance.  These were “cheap” options so we made up for it on our other trades but we are disappointed with this one. 

CBOE has been one of four losing trades since October for us with the other three ongoing.  Those three have a better shot at rebounding then this one as they are longer-term options.


Aruba Networks (ARUN, $23.11, up $0.21)

January 25 calls (ARUN110122C00025000, $0.85, up $0.05) 

Entry Price:  $1.20 (11/2/10)

Exit Target: $2.40+

Return: -29%

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

Action:  From this morning:

“Aruba is capable of big moves and there is support at $20.50.  We still feel shares can make a push past $25 by mid-January as it consolidates in its recent range of $21-$23.  Continue to hold for now.”


PowerShares QQQ (QQQQ, $54.10, up $0.02)

January 53 calls (QQQQ110122C00053000, $2.00, flat) 

Entry Price:  $1.54 (10/27/10)

Exit Target: $3.00+

Return: 30%

Stop Target: $1.40 

Action:  Continue to hold.


American Tower (AMT, $50.59, down $0.48)

April (2011) 60 calls (AMT110416C00060000, $0.30, down $0.10)

Entry Price:  $0.65 (10/20/10)

Exit Target: $1.30+

Return:  -54%

Stop Target: None

Action:  Shares are building solid support at $50-$52 for the move up to $60 early next year.  Continue to hold.


Dendreon (DNDN, $37.38, down $0.21) (COVERED CALL)


December 40 call (DNDN101218C00040000, $0.15, down $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: -3%

Stop Target: None

Action:  We will be looking to SELL another call option on Dendreon in a week or two.  This will lower our cost basis even further.

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.

We will update this section in the morning.

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