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A "Love-Hate" Relationship With Pfizer Options

Pfizer options often disappoint however there are times when they can be your best friend. Let me try and explain. First look at it's five day chart. The 24.50 series of Calls have more than doubled in price in two days. Volatile stocks like this in this price range attract an inordinate amount of attention when it comes to option trading and it only flares up during these brief periods when the stock has these extreme price moves. Look at the open interest in this one series of Calls below. It's quite substantial. Now for a simple calculation. If the stock moves up today to $25.00 these $.37 cent options on the 24.50 series of options will probably move up to the $.55 cent range. Buy and sell let's say a block of 25 contracts and you will be rewarded with a nice gain. Now let we share this one observation. Here is a look at how the D.J.I.A. traded yesterday. It was down. Who wants to be holding short term Call options overnight if the markets are souring? Wouldn't t...
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A Letter To The Editor

In Barron's on July 8th. It goes something like this. Zero-Dated Options: A Road To Addiction. I know we are at a market top when my 17-year-old son is begging me to allow him to trade these options with his savings from birthdays and graduation {"The Lastest Day-Trading Craze". Cover Story July 1st). Instant gratification. Between this and sports gambling, we are promoting addictions. Read my last Tesla blog.

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