December 2012 | Members

Do
not risk more than 5% of your trading account on any one trade but do try to
take ALL of the trades. 
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 a
“Profit Alert” or “New Trade” 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.  Closed Trades for 2012: 150-55, or 73% win rate, including the Weekly
Wrap which is 26-0).

 

 

Southern
Copper
(SCCO, $38.26, up $0.06)

 

January 40 calls (SCCO130119C00040000, $0.55, flat)

 

Entry Price:  $0.45
(12/14/12)

Exit Target:  $1.00

Return:  22%

Stop Target:  None

 

Action:  The 52-week high is $39.44
set at the beginning of November and shares traded up to $38.70 last week.  Shares could make a run past $40 to $42 on
continued momentum.  We are going to have
a tight stop for this trade and may close it if shares fail to hold $37.

 

 

Akamai
Technologies
(AKAM, $38.96, down $0.13)

 

January 42 calls (AKAM130119C00042000, $0.60, up $0.08)

 

Entry Price:  $0.56
(12/14/12)

Exit Target:  $1.15

Return:  7%

Stop Target:  None

 

Action:  Shares set a 52-week high
of $40.62 on Thursday and we are looking for a breakout to blue-sky territory.  Our near-term target is $42 but we would love
to see a run to $45.  That would get
these options to $2.50 which would be nearly a 350% return.

 

 

MGM
Resorts International

(MGM, $11.38, flat)

 

January 11 calls
(MGM130119C00011000, $0.70, flat)

 

Entry Price:  $0.51
(12/11/12)

Exit Target:  $1.00

Return:  37%

Stop Target:  55 cents, raise to 60 cents
(Hard Stop)

 

Action:  We mentioned last week shares had a good shot
at clearing $11.50 that would signal a possible breakout.  Shares traded to a high of $11.53 on Friday
which opened the door for a run to $12 and the 100-week MA.

 

 

TiVo (TIVO, $12.84, up $0.15)  

 

January 12.50 calls
(TIVO130119C00012500, $0.85, flat)

 

Entry Price:  $0.60
(12/7/12)

Exit Target:  $1.20

Return:  42%

Stop Target:  60 cents

 

 

May 14 calls
(TIVO130518C00014000, $1.05, flat)

 

Entry Price:  $0.68 (12/7/12)

Exit Target:  $1.30

Return:  54%

Stop Target:  70 cents

 

Action:  A close above $12.75 would be bullish for a
possible run to $16.  Shares traded to a
high of $12.95 on Friday.  Support has moved
up to $12 followed by $11.  We recommended
the January calls to play the near-term possible breakout and we went with the
May calls for the possibility of a buyout. 

 

 

Taser
International
(TASR,
$7.74, up $0.09)

 

January 10 calls
(TASR130119C00010000, $0.10, flat)

 

Entry Price:  $0.15
(11/29/12)

Exit Target:  $0.45

Return:  -33%

Stop Target:  None

 

 

March 10 calls
(TASR130316C00010000, $0.20, flat)

 

Entry Price:  $0.30
(11/29/12)

Exit Target:  $0.50

Return:  -33%

Stop Target:  None

 

Action:  This is also a 4-year chart.  Shares traded down to $7.51 last week and support
at $7.50 held.  We would like to see back
above $8 today.

 

 

Vivus (VVUS, $12.70, up $1.22)

 

January 15 calls
(VVUS130119C00015000, $0.60, up $0.30)

 

Entry Price:  $0.65
(11/21/12)

Exit Target:  $1.30

Return:  -8%

Stop Target:  None

 

Action:  We would like to see a close back above $12
over the near-term.  Shares could run to
$16 if the stock can clear the hurdle at $12 as there is a big gap to fill.

 

 

Rosetta
Stone
(RST, $12.28,
up $0.01)

 

January 15 calls
(RST130119C00015000, $0.15, flat)

 

Entry Price:  $0.20
(11/19/12)

Exit Target:  $1.00

Return:  -25%

Stop Target:  None

 

Action:  We would like to see a close above $12.50
this week.  Support has been strong at $12
and we will stick with the trade as long as $11.50 holds.  

 

 

Knight
Capital Group
(KCG,
$3.27, up $0.03)

 

January 2.50 calls
(KCG130119C00002500, $0.80, flat)

 

Entry Price:  $0.55 (8/21/12)

Exit Target:  $1.10

Return:  45%

Stop Target:  65 cents

 

Action:  The current buyout offer is $3.50 but we
expect a final price north of $4 by mid-January.  This would make these options worth at least
$1.50 minimum for a juicy triple-digit return. 
Shares will remain in a tight range until another offer surfaces.

 

 

Other 2012 Portfolio OPEN
positions (5):  These are trades that are still open in the portfolio but
are down over 50%.  They have longer expiration dates and 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 if the options
expire.  Click on
the 2012 Portfolio link in the Members Area to view ALL open/ closed trades.

 

Bank of America January 12.50 calls (2013) (from
March 2012) – continue to hold

Solazyme December 12.50 calls (from September
2012)– continue to hold

Lufkin
Industries
December 45 puts (from November 2012) – half
position open

LifeLock December
10 calls (from November 2012)–
continue to hold

Monster
Beverage
January 35
puts (from November 2012)– continue to hold

Apollo
Group
December 18
puts (from October 2012) – continue to hold

 

 

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 but these are the trades we are watching as new
candidates.

 

We
will update this section in the morning.