NEXT WEEK or TWO (November 10 - 24):
Overall view:
Things might pick up early next week, but I may use any rise to sell out of a couple of the Jan AAPL 175 calls I bought last week for an average price of $17. I think Apple (and high flying tech) may move sideways for a couple of weeks - which will reduce the Beta and hopefully the price of calls by late November, before the end-December rise. I'll be happy to get out of one or two calls next week for around the average purchase price, and reinvest the money in Puts.
I WILL BUY NOVEMBER OR DECEMBER INDEX PUTS ON EVERY UP DAY NEXT WEEK, TO COVER MY CURRENT NAKEDNESS.
1. LFC – Zacks.com comes out with good call, but stock is trending down. Watch the chart. I will buy LT calls in one or two weeks, or when I think the fall is over.
2. IBN – What did they do with the extra capital raised by the shares they recently issued? The additional shares brought the EPS growth down to a oh-so-terrible (tongue-in-cheek) 30 percent or so, but is whatever they are doing with that extra capital factored into analyst earnings estimates? I want to buy India because that is one of the first places that will trend upwards when people start seeing straight. Watch charts for a stop in the downtrend. Perhaps around 56?
I am concerned by the reports on IBNs debt-recovery practices, but I am encouraged by the fact that they are doing a lot in Micro financing. Hopefully, the press will keep the recovery people legit.
VE = Over-priced Utility OR cheap Water play. VE is the "Biggest Water Company In the World," according to someone I read recently. Well, it is certainly not the cheapest, and so, at the moment, I think it is a bit over-priced, but it might go still higher because of the dollar's fall. Everyone and their mother want to buy water and Euros but they don't realize that 1) the European Union is only forecasting 2.4% growth in the next couple of years, 2) there is a good chance that America will acheive the same, and 3) If #2 is true, and if people are still expecting America to fall, America will be underpriced in late November (from a six-month to one-year perspective.)
Wait till late November to buy calls?
GOLD – miners, GG. I am bullish on Gold. Gold miners haven't been rocketing like they were a couple weeks ago, which, technically, might suggest an oncoming correction. Some people are taking profits on miners, because a lot of newbies are piling on without regard to miner fundamentals.
I don't think a big gold correction is coming, but I do think some miners are risky bets. I like Nova Gold (NG), and I hold November calls.
GOOG - Remember the "G-Phone," whatever it is. The stock will not die any time soon. No matter what is happening to the rest of the economy. In fact, I want to hold onto it as a pillar of strength, and I suspect it will be the same for many others. Also remember that Tech is strong this time of the year.
One scenario: Google might come up next week, if Google announces a news conference, fall on the news that there is no immediate profit to the bottom line, and rise again in January.
I hold 100 Google shares in my LT portfolio and because I am so bullish on Google in the short-term, I don't want to sell December covered calls UNLESS it goes up a lot very fast - in which case I may sell calls before any big announcement.
Two Strategies:
1) Hold shares in LT portfolio. When expectations climb, stock will come up close to 690 again. Perhaps even past 700. Sell December Calls when Goog is very high. Perhaps December 730s, because I expect the stock to rise in December and January.
2) Sell Google shares when up. Buy LT Goog options sometime in November (late this month?), when Goog is down. Problem with this option is that Google calls are so damn expensive and it's so damn difficult to predict when exactly Google will go up.
Perhaps a combination of 1 and 2. Hold the shares and sell covered calls when high. Buy LT calls when Goog is down? Sure. Will all my millions.
AAPL - Jan estimate 220. If stock price stays stagnant, Jan calls will get cheaper. I will sell a couple of Jan calls on an up day next week, and buy them back later. Hopefull this will work, and Apple won't rocket up sooner than I can say hello. In any case, I need to free up a little capital.
Price Ranges:
November 160 - 180.
December 160-200 (towards the end of December.)
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