There were no new trades made this week.
The current Wells Fargo trade in the July $52.50 call options will continue to be held. The option closed the week at $0.38. That is a rise of $0.10 for the week. The stock closed the week at $50.78. It broke through the resistance of $50.00 and reached a 52 week high during the week. The goal for the option is still $2.50.
There are no new trades on the horizon right now.
If you would like to contact KDK Options, you can leave a comment, email at kdkoptions@gmail.com, twitter @kdkoptions, or find us on Stocktwits @kdkoptions.
** This blog is used for informational purposes only. It should not be used as a recommendation to buy or sell any security. Do your own due diligence before trading or investing. **
Friday, May 30, 2014
Sunday, May 25, 2014
Week In Review (WFC July $52.50 Call, more)
KDK Options continues to hold its position of July $52.50 call options. Last week, the option gained $0.06 and closed the week at $0.28. The option is still out of the money and all its value is time value. The goal of the trade is to see the option price reach $2.50.
Wells Fargo's stock closed the week at $50.16. That was a gain of $1.32 from last week. It was a new 52 week closing high.
If you would like to contact KDK Options, you can leave a comment, email at kdkoptions@gmail.com, twitter @kdkoptions, or find us on Stocktwits @kdkoptions.
** This blog is used for informational purposes only. It should not be used as a recommendation to buy or sell any security. Do your own due diligence before trading or investing. **
Wells Fargo's stock closed the week at $50.16. That was a gain of $1.32 from last week. It was a new 52 week closing high.
If you would like to contact KDK Options, you can leave a comment, email at kdkoptions@gmail.com, twitter @kdkoptions, or find us on Stocktwits @kdkoptions.
** This blog is used for informational purposes only. It should not be used as a recommendation to buy or sell any security. Do your own due diligence before trading or investing. **
Friday, May 16, 2014
New Call Trade Made In Wells Fargo
Yesterday, KDK Options purchased July $52.50 call options. The cost per contract of the option at the time of purchase was $0.22. The expectation price of the option is $2.50. The price of the stock will probably have to move between 7.5 and 10% for the option to reach that price. The stock is currently priced at about $49.00. The reason(s) for the purchase are below.
- Continued growth in the housing market
- Upward trend in the technical charts (3 month daily, 2 year weekly)
- Brokerage buy signals given (Goldman Sachs, Nomura)
If you would like to contact KDK Options, you can leave a comment, email at kdkoptions@gmail.com, twitter @kdkoptions, or find us on Stocktwits @kdkoptions.
** This blog is used for informational purposes only. It should not be used as a recommendation to buy or sell any security. Do your own due diligence before trading or investing. **
- Continued growth in the housing market
- Upward trend in the technical charts (3 month daily, 2 year weekly)
- Brokerage buy signals given (Goldman Sachs, Nomura)
If you would like to contact KDK Options, you can leave a comment, email at kdkoptions@gmail.com, twitter @kdkoptions, or find us on Stocktwits @kdkoptions.
** This blog is used for informational purposes only. It should not be used as a recommendation to buy or sell any security. Do your own due diligence before trading or investing. **
Thursday, May 1, 2014
Importance of Checklists
When trading or investing, having a checklist can make the difference between having a profitable trade or a losing trade. KDK Options had a great example using its own checklist today.
KDK Options was looking at buying Morgan Stanley calls. The price of the stock was in a place where the trade had a good probability of success. The price of the option was lower than thought. The fundamental and technical expectations for the trade were met.
So what caused KDK Options to pull out of the trade? The expiration date of the option did not provide the needed amount of time needed for the trade. The option contract KDK originally started looking at was a May option. The trade looked pretty positive until getting to this one question. Because the expiration would be the third Friday, KDK originally thought that it would be in three weeks! But after answering the question on the checklist, it was made clear that the option only had two weeks left before expiration. This disqualified the trade.
The process of finding the right option trade can be long and tedious. Having a checklist can make that process a little clearer and simpler. It can mean the difference between a profitable trade and a losing trade. In the example above, the checklist highlighted the fact that the time left on the option was not sufficient for KDK Options to make the trade. It does not mean that the trade would not have been successful. It just meant that the probability for success with this trade was not high enough to go through with it.
KDK Options was looking at buying Morgan Stanley calls. The price of the stock was in a place where the trade had a good probability of success. The price of the option was lower than thought. The fundamental and technical expectations for the trade were met.
So what caused KDK Options to pull out of the trade? The expiration date of the option did not provide the needed amount of time needed for the trade. The option contract KDK originally started looking at was a May option. The trade looked pretty positive until getting to this one question. Because the expiration would be the third Friday, KDK originally thought that it would be in three weeks! But after answering the question on the checklist, it was made clear that the option only had two weeks left before expiration. This disqualified the trade.
The process of finding the right option trade can be long and tedious. Having a checklist can make that process a little clearer and simpler. It can mean the difference between a profitable trade and a losing trade. In the example above, the checklist highlighted the fact that the time left on the option was not sufficient for KDK Options to make the trade. It does not mean that the trade would not have been successful. It just meant that the probability for success with this trade was not high enough to go through with it.
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