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Yos Vendijanto
10 Comments
Pair Trade Visa and Capital One
Visa: Near-Term Fluctuations Present a Buying Opportunity
i agree V winner
Visa: Near-Term Fluctuations Present a Buying Opportunity
the price you buying now is at 2.8 if i'm not wrong and it will be 3-10 depends like i stated above
I keep the profit, pay the premium and that's it?
you don't need to pay any premium the premium is included in 1 value since options have 2 value
1.instricted value
2.premium that included delta theta vega rho and gamma
just get the profit by closing your call options. depends what the price you will sell thats your profit let's say 2.8 and you sell them at 5 dollars so you pocket 2.2 dollars.
If it expires I just pay the premium?
if it expires you will lose your entire value of the call options.
Visa: Near-Term Fluctuations Present a Buying Opportunity
You won't get $12 on the June 100 if Visa hits 100
i think it's around $8 if the implied volatility remains the same, and it's reaching $100 by today or next day since the time decay value not much eating your options price.
i would say your options when visa @100 would be ranging from 3.5 dollars to 10 dollars depends on the implied volatility when visa at 100 and how long it will reach $100( longer time it reach 100 you need to pay more theta).
What happens to your call with visa if it reach $100?
well the delta of the options move in to at the money options which more likely have 0.5 delta so every time visa move 1 dollar it will give 50 cents to your options compare it when visa at 88 dollar it just have 0.264 delta. the more deep in the money the delta of the options move to 1. call options have positive delta ranging 0-1 and put options have negative delta ranging 0 - (-1).
as V winner stated if we reach 100 there would be a physchological price, i believe as well it will lead into retrenchment or reversal that we won't know as well. but with put options it can cover the decrease of the value of your shares by gaining in your put contracts ( maybe i'm little bit conservative as well :P)
you can exercise visa @100 but you lose all your premium so you won't be exercising visa even though visa @100 because more likely your options price would be around 3-10 dollars. Since i have the call options as well i hope Visa would move to $100 in short momentum time and hoping the volatility will increase :). so i can get both of the delta and vega move in our side to covering the theta.
and yes you shouldn't do investment in options, options is risky and it's game played. it rewarded you well but it can kill your entire portfolio. because by buying options you are not only depends on the price to move up or down but we need to be aware of the decreasing time value and Volatility of the stock as well.
Good luck
Regards
Yos
Visa: Near-Term Fluctuations Present a Buying Opportunity
Good luck and nice to meet you i really learn a lot about fundamental things from your post in this blog
Regards
Visa: Near-Term Fluctuations Present a Buying Opportunity
Options calculations is a bit complex they use black scholes models
you can use this webs to help you to calculate www.cboe.com/framed/IV...
The most you need care of is about Implied Volatility or Vega in options pricing model.
Does the contract sell automatically at $100?
it will sell automatically at $100 is your brokerage allowed you to set contingent order by triggering your call options when Visa hit 100.
By buying options you will always have negative theta or time decay value. and hoping that Vega or implied volatility move in your favour.
unless you want to use your call options to exercise it @ expirations date and hoping the price is above that the strike price that you bought.
let's say you have 100 jun visa strike at 0.3 delta at this moment
it means if Visa move 1 dollar it will move 0.3 in your options price. but the delta won't be the same because the delta will move to 1 as your options move in the money and move to 0 as the options move to out the money. the rate of change of the delta calculated by gamma. but the link that i gave you is just rough calculations how much your options would be worth. just my 2 cents
Regards and good luck
Visa: Near-Term Fluctuations Present a Buying Opportunity
June 100 calls (big position)
June 105 calls (mid case position)
i have 105 calls too V winner. i'm thinking we will have short term momentum on the way to $100(but not going to risk a lot). as we have very good pattern on point and figure charting, the ascending triangle break out. and the pull back today i think is to make sure that the 87-88 area tested being support and we won't have other resistance after this until it makes new ones. the other good support around 81.8 area. viva la visa :)
Regards and good luck
nice to meet you all
Intrepid Potash IPO: Soaring Shares Signal Fertilizer Bubble?
higher oil price leads to higher commodity price and higher commodity price will lead into high potash. correct me if I'm wrong. and i do believe that we will have higher oil price within 2 more next year.
Regards
Jos
Intrepid Potash IPO: Soaring Shares Signal Fertilizer Bubble?
Intrepid Potash IPO: Soaring Shares Signal Fertilizer Bubble?
Regards
Jos