November 2011 | 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 “Profit 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.

1:50pm (EST)

Rambus (RMBS, $17.87, up $0.30)

December 20 calls (RMBS111217C00020000, $1.90, down $0.05)

Entry Price:  $1.70 (11/2/11)
Exit Target: $3.40
Return:  12% 
Stop Target:  $2.45

Action:  We have a $30 price target on Rambus if they get a favorable court ruling in their current litigation case.  The deliberations have been ongoing for 7 weeks now and we should (should) hear something soon.   


S&P 500 Spiders (SPY, $125.66, up $1.57)

December 128 calls (SPY111217C00128000, $3.15, up $0.60)

Entry Price:  $2.15 (11/1/11)
Exit Target: $3.25 (closed half at $3.00 on 11/3/2011)
Return:  43%
Stop Target:  $1.00, raise to $2.00

Action:  We closed half of this trade today because the premiums are high and we wanted to take some risk off the table.   


Las Vegas Sands (LVS, $48.28, up $0.03)

December 52.50 calls (LVS111217C00052500, $1.40, down $0.10)

Entry Price:  $1.25 (11/1/11)
Exit Target: $2.50
Return:  12%
Stop Target:  None

Action:  We are looking for shares to make a push past $50 to $55 over the next month.     


Skyworks Solutions (SWKS, $20.30, up $1.22)

January 25 calls 2012 (SWKS120121C00025000, $1.05, up $0.30)

Entry Price:  $0.80 (10/31/11)
Exit Target: $1.60
Return:  31%
Stop Target:  None

Action:  The company will report earnings after the bell and we are looking for a beat-and-raise.    


Alcoa (AA, $10.86, up $0.16)

December 13 calls (AA111217C00013000, $0.11, flat)

Entry Price:  $0.15 (10/28/11)
Exit Target: $0.36
Return:  -27%
Stop Target:  None

Action:  Continue to hold.


Vivus (VVUS, $9.39, down $0.10)     

December 10 calls (VVUS111217C00010000, $0.80, flat)

Entry Price:  $0.50 (10/28/11)
Exit Target: $1.00
Return:  60%
Stop Target:  None

March 12 calls 2012 (VVUS120317C00012000, $2.00, flat)

Entry Price:  $1.55 (10/28/11)
Exit Target: $3.10
Return:  29%
Stop Target:  75 cents

Action:  We can almost taste $10.


Taiwan Semiconductor Manufacturing (TSM, $12.89, up $0.16)

December 12.50 calls (TSM111217C00012500, $0.75, flat)

Entry Price:  $0.50 (10/26/11)
Exit Target: $1.00
Return:  50%
Stop Target:  50 cents

Action:  The 52-week high is $14.05 for TSM and we are looking for a print of $15 by mid-December.  This would get the options to at least $2.50.


Qualcomm (QCOM, $55.79, up $3.61)

November 57.50 calls (QCOM111119C00057500, $0.75, up $0.45)

Entry Price:  $0.95 (10/18/11)
Exit Target: $1.50-1.90
Return:  -21%
Stop Target:  None

Action:  The options opened at $1.20 but we decided to hold these calls into Friday and we will see where we are at tomorrow. 


Spreadtrum Communications (SPRD, $27.55, down $0.63)     

January 25 calls 2012 (SPRD120121C00025000, $4.80, down $0.30)

Entry Price:  $1.50 (9/9/11)
Exit Target: $2.80 (closed half at $2.90 on 10/27/11)
Return:  147%
Stop Target:  $4.00 (HARD STOP)

Action:  Continue to hold the other half.


Other 2011 Portfolio OPEN positions (4):  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.  This means we would not open any new positions.  We are still keeping track of the trades and we will record the results, accordingly, when we close them or the options expire.  Click on the 2011 Portfolio link in the Members Area to view ALL open/ closed trades.

JDSU Uniphase January 20 calls (from August 2011)

                      January 16 calls (from August 2011)

Lufkin Industries December 80 calls (from September 2011)

Seattle Genetics November 17.50 puts (from October 2011)

Potash November 52.50 calls (from October 2011)


WATCH LIST SECTION

These trades are NOT recommendations.  They 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 try not to have more than 12-15 open trades at any one time which is why we created a Watch List.  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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11:50am (EST)

PowerShares QQQ (QQQ, $57.59, up $0.67)

November 58 calls (QQQ111119C00058000, $1.10, up $0.20)

Entry Price:  $0.90 (11/1/11)
Exit Target: $1.35-$1.80
Return:  17%
Stop Target:  None

Action:  These options could continue to do well but we want to take a little risk off the table ahead of tomorrow’s nonfarm payrolls report.  Close the positions at current levels but use limit orders to get the best prices.  


S&P 500 Spiders (SPY, $125.05, up $1.06)

December 128 calls (SPY111217C00128000, $3.00, up $0.45)

Entry Price:  $2.15 (11/1/11)
Exit Target: $3.25
Return:  40%
Stop Target:  $1.00

Action:  Close HALF of the trade at current levels.   


Pepsico (PEP, $62.34, down $0.07)

January 65 calls 2012 (PEP120121C00065000, $0.80, down $0.05)

Entry Price:  $0.70 (10/24/11)
Exit Target: $1.40
Return:  14%
Stop Target:  None 

Action:  Our interest has fizzled on this trade so let’s lock in profits and look to move our cash into some faster moving options.

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8:50am (EST)

Rambus (RMBS, $17.57, up $0.40)

December 20 calls (RMBS111217C00020000, $1.95, up $0.25)

Entry Price:  $1.70 (11/2/11)
Exit Target: $3.40
Return:  15% 
Stop Target:  $2.45

Action:  We feel more comfortable now holding the December options because we were a little worried with the premium being zapped in the November calls which expire in two weeks.  We said yesterday we have a $30 price target on Rambus if they get a favorable court ruling in their current litigation case.  The deliberations have been ongoing for 7 weeks now and we should (should) hear something soon.   


PowerShares QQQ (QQQ, $56.92, up $0.48)

November 58 calls (QQQ111119C00058000, $0.90, flat)

Entry Price:  $0.90 (11/1/11)
Exit Target: $1.35-$1.80
Return:  0%
Stop Target:  None

Action:  We have been planning to exit this trade by Friday, regardless, so we may get out this morning on strength.


S&P 500 Spiders (SPY, $123.99, up $1.99)

December 128 calls (SPY111217C00128000, $2.55, up $0.40) 

Entry Price:  $2.15 (11/1/11)
Exit Target: $3.25
Return:  19%
Stop Target:  $1.00

Action:  With the nonfarm payrolls report due in the morning, we may close half or all of this trade to take some risk off the table.  With these index trades, we may be in-and-out of them quickly, depending how volatile the market stays.


Las Vegas Sands (LVS, $48.25, up $1.10)

December 52.50 calls (LVS111217C00052500, $1.50, up $0.10)

Entry Price:  $1.25 (11/1/11)
Exit Target: $2.50
Return:  20%
Stop Target:  None

Action:  Shares traded to a high of $49.25 yesterday while the options made it up to $1.94 which represented a gain of 50+%.  We are looking for shares to make a push past $50 to $55 over the next month.     


Skyworks Solutions (SWKS, $19.08, down $0.03)

January 25 calls 2012 (SWKS120121C00025000, $0.75, down $0.05)

Entry Price:  $0.80 (10/31/11)
Exit Target: $1.60
Return:  -6%
Stop Target:  None

Action:  Shares are showing a bid of $19.75 in pre-market action and the company will report earnings after the bell today.  


Alcoa (AA, $10.70, up $0.33)

December 13 calls (AA111217C00013000, $0.11, flat)

Entry Price:  $0.15 (10/28/11)
Exit Target: $0.36
Return:  -27%
Stop Target:  None

Action:  We closed out the November calls yesterday for a small double-digit profit and we think these calls will do well over the next 6 weeks.   


Vivus (VVUS, $9.49, up $0.04)     

December 10 calls (VVUS111217C00010000, $0.80, up $0.05)

Entry Price:  $0.50 (10/28/11)
Exit Target: $1.00
Return:  60%
Stop Target:  None

March 12 calls 2012 (VVUS120317C00012000, $2.00, up $0.15)

Entry Price:  $1.55 (10/28/11)
Exit Target: $3.10
Return:  29%
Stop Target:  75 cents  

Action:  We can almost taste $10.


Taiwan Semiconductor Manufacturing (TSM, $12.72, up $0.27)

December 12.50 calls (TSM111217C00012500, $0.75, up $0.05)

Entry Price:  $0.50 (10/26/11)
Exit Target: $1.00
Return:  50%
Stop Target:  50 cents

Action:  The 52-week high is $14.05 for TSM and we are looking for a print of $15 by mid-December.  This would get the options to at least $2.50 but we will be glad if they can get to $1, first.

 

Pepsico (PEP, $62.41, up $0.18)

January 65 calls 2012 (PEP120121C00065000, $0.85, flat)

Entry Price:  $0.70 (10/24/11)
Exit Target: $1.40
Return:  21%
Stop Target:  None 

Action:  We would like to see another push towards $63 today.


Qualcomm (QCOM, $52.18, up $2.04)

November 57.50 calls (QCOM111119C00057500, $0.30, up $0.05)

Entry Price:  $0.95 (10/18/11)
Exit Target: $1.50-1.90
Return:  -68%
Stop Target:  None

Action:  Shares were up over $5 in after-hours and the 52-week high is $59.84.  We have been looking for shares to make a run past $60 and we have been saying this could be the catalyst to get us there.  However, we have to get back to even first after shares dipped below $50 on Monday.  


Spreadtrum Communications (SPRD, $28.18, up $0.93)     

January 25 calls 2012 (SPRD120121C00025000, $5.10, up $0.70)

Entry Price:  $1.50 (9/9/11)
Exit Target: $2.80 (closed half at $2.90 on 10/27/11)
Return:  167%
Stop Target:  $4.00 (HARD STOP)

Action:  Shares hit another 52-week high of $28.75 yesterday.  We have been waiting to add to this position but the other half of this trade continues to perform well. 

We have mentioned when stocks breakout to new all-time highs that it is considered “blue-sky” territory because there is no overhead resistance.  The company announces earnings next week and by the looks of things, they are going to announce a blowout quarter.  We are watching the November 30 calls for a possible earnings trade next week.        


Other 2011 Portfolio OPEN positions (4):  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.  This means we would not open any new positions.  We are still keeping track of the trades and we will record the results, accordingly, when we close them or the options expire.  Click on the 2011 Portfolio link in the Members Area to view ALL open/ closed trades.

JDSU Uniphase January 20 calls (from August 2011)

January 16 calls (from August 2011) – shares made a nice pop over $12 yesterday and we could be bringing back coverage of these options soon.

Lufkin Industries December 80 calls (from September 2011)

Seattle Genetics November 17.50 puts (from October 2011)

Potash November 52.50 calls (from October 2011)
 

WATCH LIST SECTION

These trades are NOT recommendations.  They 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 try not to have more than 12-15 open trades at any one time which is why we created a Watch List.  We will not list entry prices because these stocks are on the verge of breaking out or they could sell off.  

Newpark Resources (NR, $8.80, up $0.28)

December 10 call (NR111217C00010000, $0.70, up $0.05)

March 10 calls (NR120317C00010000, $1.00, up $0.20)

Thoughts:  A run to $15 is possible over the next 3-6 months.  


U.S. Bancorp (USB, $25.38, up $0.78)

December 26 calls (USB111217C00026000, $1.00, up $0.30)

Thoughts:  Continue to watch.


SkullCandy (SKUL, $14.85, flat)

December 15 calls (SKUL111217C00015000, $1.20, flat)

Thoughts:  Earnings are after the bell and we may take a half position shot with these call options depending how the market is acting.   


SanDisk (SNDK, $49.16, up $0.14)

December 55 calls (SNDK111217C00055000, $0.95, down $0.10)

January 60 calls 2012 (SNDK120121C00060000, $0.80, down $0.05)

Thoughts:  Continue to watch.