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.

12:30pm (EST)

Jabil Circuit (JBL, $17.05, up $0.34)

March 19 calls (JBL110319C00019000, $0.80, up $0.15)

Entry Price:  $0.70 (12/14/10)

Exit Target: $1.50+

Return: 14%

Stop Target: None

Action:  We like this trade a lot.  The 52-week high is $18.49 but we think shares will be pushing $20 by mid-March.

 

THQ (THQI, $5.79, up $0.19)

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:  Continue to hold.


Foster Wheeler (FWLT, $33.22, down $0.29)

January 30 calls (FWLT110122C00030000, $3.80, down $0.30)

Entry Price:  $1.00 (11/30/10)

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

Return: 185%

Stop Target: $3.00, raise to $3.50 (HARD STOP)

Action:  The calls have traded to a low of $3.70 so we have raised the hard stop to $3.50 for the other half.  Continue to hold, otherwise.   

 

Electronic Arts (ERTS, $15.78, up $0.02)

March 20 calls (ERTS110319C00020000, $0.23, flat) 

Entry Price:  $0.22 (11/24/10)

Exit Target: $0.50+

Return: 5%

Stop Target: None

Action:  We are waiting for a break above $16 to get this trade rolling.  Continue to hold.


JDS Uniphase (JDSU, $14.00, up $0.14)

March 12 calls (JDSU110319C00012000, $2.50, up $0.20) 

Entry Price:  $1.25 (11/19/10)

Exit Target: $2.50 (closed half @ $2.70 on 12/13/10)

Return:  108%

Stop Target: $2.00

Action:  Continue to hold the other half.


Riverbed Technology (RVBD, $34.41, down $1.51)

March 35 calls (RVBD110319C00035000, $3.30, down $1.20)

Entry Price:  $1.40 (11/17/10)

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

Return: 141%

Stop Target:  $3.75 (HARD STOP on other half) 

Action:  The calls traded to a high of $5.50 on Monday but shares of Riverbed fell nearly 4% by the close and we had a feeling we would be stopped out today.  The calls opened at $4.30 but quickly came down in price and the stop of $3.75 was taken out.

The total return was over 140% for the trade but we are not done with Riverbed.  We think shares are headed to $50 and we will be back to play this one for sure in 2011.


Aruba Networks (ARUN, $22.26, down $0.24)

January 25 calls (ARUN110122C00025000, $0.55, down $0.05) 

Entry Price:  $1.20 (11/2/10)

Exit Target: $2.40+

Return: -54%

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

Action:  We should probably close this trade at current levels but we are going to stick with if shares can hold $20.       


PowerShares QQQ (QQQQ, $54.55, up $0.25)

January 53 calls (QQQQ110122C00053000, $2.15, up $0.10) 

Entry Price:  $1.54 (10/27/10)

Exit Target: $3.00+

Return: 40%

Stop Target: $1.75 (HARD STOP)

Action:  We have made the $1.75 a HARD STOP.  We still think the Q’s push higher but we want to protect our profits in case they slip.


American Tower (AMT, $50.60, up $0.59)

April (2011) 60 calls (AMT110416C00060000, $0.30, flat)

Entry Price:  $0.65 (10/20/10)

Exit Target: $1.30+

Return:  -54%

Stop Target: None

Action:  Continue to hold.


Dendreon (DNDN, $36.38, down $0.18) (COVERED CALL)

December 40 call (DNDN101218C00040000, $0.10, 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: -7%

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.

FedEx (FDX, $94.40, up $0.09)

January 100 calls (FDX110122C00100000, $1.30, flat)

Action:  We think FedEx will beat estimates but we just don’t need to take any unnecessary risks right now. As much as we would love to take a shot at these calls, we are going to sit on the sidelines.


Adobe Systems (ADBE, $27.75, down $0.06)

January 30 calls (ADBE110122C00030000, $0.65, flat)

April 31 calls (ADBE110416C00031000, $1.20, flat)

April 26 puts (ADBE110416P00026000, $1.55, flat)

Action:  Watch for now.


Darden Restaurants (DRI, $48.05, down $0.49)

April 55 calls (DRI110416C00055000, $0.70, down $0.15)

Action:  We could be close to pulling the trigger on this one.  We think Darden is worth $60 a share and these options will be worth $5 if shares can get there by mid-April.


DryShips (DRYS, $6.34, up $0.04)

March 7 calls (DRYS110319C00007000, $0.45, flat)

June 7 calls (DRYS110618C00007000, $0.70, flat)

Action:  Continue to watch.  


Juniper Networks (JNPR, $35.92, down $0.24)

January 35 calls (JNPR110122C00035000, $1.95, down $0.15)

Action:  We think a run to $40 is in the cards once $36 is taken out.


CurrencyShares Euro Trust (FXE, $133.68, up $0.25)

January 130 puts (FXE110122P00130000, $0.95, down $0.10)

Action:  We would like to see a run back to $135 before we go short.  We think the Euro is headed to $1.25 early next year.     


Skyworks Solutions (SWKS, $26.90, down $0.19)

January 28 calls (SWKS110122C00028000, $0.85, down $0.10)

Action:  Watch for now.

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11:20am (EST)

NEW TRADE!!!

Jabil Circuit (JBL, $17.05, up $0.34)

Buy to OPEN March 19 calls (JBL110319C00019000, $0.70, up $0.05)

Action:  We have been watching this stock for a few weeks and we like the action.  We are going to go a little further out with the options to give this trade plenty of time to take shape.  The current bid is 70 cents, the ask is 75 cents.  You can use limit orders at current prices but do not pay more than 85-90 cents for the position.

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9:00am (EST)

THQ (THQI, $5.62, down $0.19)

June 6 calls (THQI110618C00006000, $0.85, down $0.05)

Entry Price:  $0.75 (12/8/10)

Exit Target: $2.00

Return: 13%

Stop Target: None

Action:  Continue to hold.


Foster Wheeler (FWLT, $33.51, up $0.06)

January 30 calls (FWLT110122C00030000, $4.10, flat)

Entry Price:  $1.00 (11/30/10)

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

Return: 200%

Stop Target: $3.00 (HARD STOP)

Action:  Continue to hold the other half.    

 

Electronic Arts (ERTS, $15.76, down $0.06)

March 20 calls (ERTS110319C00020000, $0.23, down $0.02) 

Entry Price:  $0.22 (11/24/10)

Exit Target: $0.50+

Return: 5%

Stop Target: None

Action:  We are waiting for a break above $16 to get this trade rolling.  Continue to hold.


JDS Uniphase (JDSU, $13.86, up $0.43)

March 12 calls (JDSU110319C00012000, $2.30, up $0.30) 

Entry Price:  $1.25 (11/19/10)

Exit Target: $2.50 (closed half @ $2.70 on 12/13/10)

Return:  100%

Stop Target: $2.00

Action:  We closed half at current levels and raised the stop to $2 yesterday. Continue to hold the other half.


Riverbed Technology (RVBD, $35.92, down $1.38)

March 35 calls (RVBD110319C00035000, $4.50, down $0.80)

Entry Price:  $1.40 (11/17/10)

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

Return: 168%

Stop Target:  $3.75 (HARD STOP on other half) 

Action:  The calls traded to a high of $5.50 on Monday but shares of Riverbed fell nearly 4% by the close.  Continue to hold the other half but we are gone if the hard stop is hit.


Aruba Networks (ARUN, $22.50, down $0.66)

January 25 calls (ARUN110122C00025000, $0.60, down $0.20) 

Entry Price:  $1.20 (11/2/10)

Exit Target: $2.40+

Return: -50%

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

Action:  Continue to hold.    


PowerShares QQQ (QQQQ, $54.30, down $0.19)

January 53 calls (QQQQ110122C00053000, $2.05, down $0.15) 

Entry Price:  $1.54 (10/27/10)

Exit Target: $3.00+

Return: 33%

Stop Target: $1.75 

Action:  We have made the $1.75 a HARD STOP.  We still think the Q’s push higher but we want to protect our profits in case they slip.


American Tower (AMT, $50.01, down $0.45)

April (2011) 60 calls (AMT110416C00060000, $0.30, flat)

Entry Price:  $0.65 (10/20/10)

Exit Target: $1.30+

Return:  -54%

Stop Target: None

Action:  We said yesterday a break below $50 would give us second thoughts on this trade.  Let’s see how this one shakes out today.  Continue to hold.


Dendreon (DNDN, $36.56, down $1.09) (COVERED CALL)

December 40 call (DNDN101218C00040000, $0.15, flat)

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:  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.

FedEx (FDX, $94.31, up $0.33)

January 100 calls (FDX110122C00100000, $1.30, up $0.05)

Action:  We have been calling for FedEx to hit $100 and their earnings announcement will either get them there or the stock fall below $90.  We recommended these calls at $1.25 at the end of November and told subscribers to exit half at $2.15 when shares were testing their 52-week high just 3-days later.  We closed the other half when the calls slipped back to $1.60 and shares slipped after a failed test of resistance.

The bulls could use the company’s earnings to push shares to new highs but FedEx will have to impress.


Adobe Systems (ADBE, $27.81, down $0.90)

January 30 calls (ADBE110122C00030000, $0.65, down $0.30)

April 33 calls (ADBE110416C00033000, $0.70, down $0.25)

April 26 puts (ADBE110416P00026000, $1.55, up $0.25)

Action:  Watch for now.


Research In Motion (RIMM, $60.81, down $1.34)

December 65 calls (RIMM101218C00065000, $0.75, down $0.45)

January 70 calls (RIMM110122C00070000, $0.80, down $0.35)

January 55 puts (RIMM110122P00055000, $1.30, up $0.10)

Action:  We will probably sit on the sidelines with RIMM as the company reports earnings this Thursday.

RIMM is usually a big mover on earnings but last time they announced earnings (September) shares fell slightly.  In June, the stock fell from $58 to $52 after reporting.

RIMM is going to have to say some impressive things to wow Wall Street but we are a little nervous with this one which is why we will probably sit on the sidelines.  As much as we want to trust RIMM, we don’t.


Darden Restaurants (DRI, $48.54, down $0.94)

April 55 calls (DRI110416C00055000, $0.85, down $0.30)

Action:  We think Darden is worth $60 a share and these options will be worth $5 if shares can get there by mid-April.


DryShips (DRYS, $6.30, down $0.03)

March 7 calls (DRYS110319C00007000, $0.45, down $0.05)

June 7 calls (DRYS110618C00007000, $0.70, down $0.05)

Action:  Continue to watch.  


Juniper Networks (JNPR, $36.16, up $0.28)

January 35 calls (JNPR110122C00035000, $2.10, up $0.15)

Action:  We think a run to $40 is in the cards once $36 is taken out.


CurrencyShares Euro Trust (FXE, $133.42, up $1.63)

January 130 puts (FXE110122P00130000, $1.05, down $0.50)

Action:  We replaced the Jan’s 125 puts with the 130 puts.  We would like to see a run back to $135 before we go short.  We think the Euro is headed to $1.25 early next year.     


Skyworks Solutions (SWKS, $27.09, down $0.95)

January 28 calls (SWKS110122C00028000, $0.95, down $0.55)

Action:  Watch for now.

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