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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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Netflix As A Mid Week Trading Vehicle

I often talk about Wednesdays being turn around days for the markets. Today was one of those days. Netflix had a big drop and then came back a small bit towards the close. Look at this, the 1220 Puts on Netflix at the start of the day, a Wednesday. Can you see they closed Tuesday at $1,340?
Now this. It's Calls.
Now it's one day chart.
Here how the Puts and Calls traded.
The Puts more than doubled in price in the morning and the Calls lost more than half of their value. What's the importance of this read? Maybe there should be more energy put into tracking these moves. Costco options offer the same trading experiences. Three hour moves in mid week trading sessions on high priced stocks can can sometimes offer profitable experiences without the urgency of time (the time value premium on options) working against you.

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