9:00am (EST)

FedEx (FDX, $93.29, down $1.71)

January 100 calls (FDX110122C00100000, $1.30, down $0.55)

Entry Price:  $1.25 (11/30/10)

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

Return: 40%

Stop Target: $1.20, place HARD STOP at $1.05 on other half

Action:  Shares are up $1.40 in pre-market action to $94.69.

We closed half of the trade last Thursday when shares ran up to $96.  At the time, shares were around $91 which will serve as support.  We have also set a HARD STOP of $1.05 and we will have to close the other half if hit.  The good news is that the $1.05 hard stop locks in a 28% return.

This is the beauty of closing half of your positions on strength is that you can define your entry and exit points to fit the return you want.  Some may choose to set theirs higher or lower depending on what they are trying to get out of the trade but this also allows time to see if shares test $100.


Foster Wheeler (FWLT, $30.74, down $0.37)

January 30 calls (FWLT110122C00030000, $2.10, down $0.35)

Entry Price:  $1.00 (11/30/10)

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

Return: 100%

Stop Target: $1.75

Action:  Shares hit a high of $31.50 before falling back while the options traded up to $2.60.  Continue to hold the other half but we will be watching our $1.75 stop if shares slip further.  A break below $30 will probably get us to close the other half but we are looking for a run to $35.

The stock is showing a pre-market bid of $31+.

 

Electronic Arts (ERTS, $15.43, up $0.25)

March 20 calls (ERTS110319C00020000, $0.22, flat)

Entry Price:  $0.22 (11/24/10)

Exit Target: $0.50+

Return: 0%

Stop Target: None

Action:  This sector is heating up.  We can feel the momentum coming for some M&A activity.  Continue to hold.


JDS Uniphase (JDSU, $12.85, up $0.12)

March 12 calls (JDSU110319C00012000, $1.65, up $0.05) 

Entry Price:  $1.25 (11/19/10)

Exit Target: $2.50

Return:  32%

Stop Target: $1.25

Action:  Shares are pushing $13 in early action.  Continue to hold.


Riverbed Technology (RVBD, $35.57, up $0.75)

March 35 calls (RVBD110319C00035000, $4.40, up $0.60)

Entry Price:  $1.40 (11/17/10)

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

Return: 164%

Stop Target:  $2.70, raise to $3.20 (HARD STOP on other half) 

Action:  The call options traded to a high of $5.00 yesterday as shares set another 52-week high of $36.80.  Continue to hold the other half.


CBOE Holdings (CBOE, $24.82, up $0.42)

December 25 calls (CBOE101218C00025000, $0.45, up $0.10) 

Entry Price:  $0.75 (11/8/10)

Exit Target: $2.40+

Return: -40%

Stop Target: None

Action:  The stock touched $25.16 on Monday and we need a run to $25.75 to at least break even on this trade.  Continue to hold.


Darden Restaurants (DRI, $50.11, down $0.21)

December 49 calls (DRI101218C00049000, $1.60, down $0.20) 

Entry Price:  $1.20 (11/8/10)

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

Return:  42%

Stop Target: $1.25   

Action:  Continue to hold the other half.


Aruba Networks (ARUN, $22.98, down $0.04)

January 25 calls (ARUN110122C00025000, $0.80, down $0.10) 

Entry Price:  $1.20 (11/2/10)

Exit Target: $2.40+

Return: -33%

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

Action:  Continue to hold for now. 


PowerShares QQQ (QQQQ, $53.85, down $0.02)

January 53 calls (QQQQ110122C00053000, $1.90, down $0.10)

Entry Price:  $1.54 (10/27/10)

Exit Target: $3.00+

Return: 23%

Stop Target: $1.40 

Action:  Continue to hold but we are getting a little impatient with this trade.  We have been in it for nearly 5 weeks but we haven’t gotten the pop to a least take half profits at higher levels.  We still think the Q’s can trade up to $55+ by mid-January and we should see a pop in these options today.


American Tower (AMT, $51.77, up $0.19)

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:  These options have xx days before expiration.  We are looking for a run back towards its 52-week high of $53+ over the near-term.  Continue to hold.


Dendreon (DNDN, $38.07, down $0.86) (COVERED CALL)

December 40 call (DNDN101218C00040000, $0.30, down $0.30)

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.

DryShips (DRYS, $6.21, up $0.33)

March 7 calls (DRYS110319C00007000, $0.48, up $0.14)

June 7 calls (DRYS110618C00007000, $0.70, up $0.22)

Action:  DryShips is on fire right now but we would like to get a pullback in the stock before thinking of going long.  We may not get the chance though.


McDonald’s (MCD, $79.58, down $0.18)

January 80 calls (MCD110122C00080000, $1.60, down $0.15)

Action:  The 52-week high is $79.90 and we are looking for a break above $80.  We have dropped coverage of the 85’s and we are going to follow the January 80’s.  If shares break above $80 we may ride these for a quick trade.


Juniper Networks (JNPR, $34.10, down $0.22)

January 35 calls (JNPR110122C00035000, $1.15, down $0.25)

Action:  We made 10% on the December calls and we closed these out yesterday for 13% but we still like the stock. However, shares haven’t displayed the momentum we would like to see although we think a run to $40 by mid-January is still in the cards.


CurrencyShares Euro Trust (FXE, $132.64, down $0.94)

January 125 puts (FXE110122P00125000, $0.60, up $0.15)

Action:  We would like to see a run back to $135 before we go short.  We think the Euro is headed to $1.25 by mid-January.  These look so tempting at current levels.  


Skyworks Solutions (SWKS, $27.62, up $0.05)

January 26 calls (SWKS110122C00026000, $2.40, down $0.05)

Action:  The calls have already doubled since we first profiled them and we are looking at other options in Skyworks.     


THQ (THQI, $5.57, up $0.08)

March 5 calls (THQI110319C00005000, $1.10, up $0.10)

Action:  Continue to watch.


Ingersoll-Rand (IR, $43.02, up $0.11)

January 42.50 calls (IR110122C00042500, $1.80, flat)

Action:  Watch for now.

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