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Dr. Terry Allen  

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  • How To Play The Salesforce.com Earnings Announcement [View article]
    I must disagree with you. The software I use structures in the expected drop in IV after earnings, and I report exactly how much I have reduced IV (and I base it on where IV fell to after the last earnings announcement). In this article I have assumed (and the graph includes it) that IV will fall from 48 to 40 for the June options.

    Your second statement is comparing apples and oranges. Maybe I was not clear in the article. The 6.6% average change only refers to the stock price after the earnings announcement. It doesn't have anything to do with option prices, past or forward.

    Your third statement is inaccurate. No matter how far the stock might fall, there will still be a gain. The intrinsic value of the diagonal spread can never be worth less than $2.50 which is less than you paid for it. Since the June options have a month of life remaining, the spread is highly likely to be worth more than the intrinsic value. It is true that if the stock moves higher by a very large amount, a loss would result, and it could be a big one, but I have made over 22% after commissions on 8 consecutive option trades, and I could handle of big loss every once in a while if I am terribly wrong in the direction I think the stock will move. Usually, big moves are to the downside, and that is where I have total protection in this CRM play.
    May 19, 2013. 04:37 PM | 2 Likes Like |Link to Comment
  • How To Play The Salesforce.com Earnings Announcement [View article]
    I got my numbers from the TD Ameritrade charting software which includes the last four quarters of estimates and actual earnings.. If you run a chart for CRM those are the numbers they report.

    I did suspect there might be a discrepancy between the GAAP and adjusted actuals but could not see why TD would post apple and orange comparisons.
    May 19, 2013. 04:13 PM | 1 Like Like |Link to Comment
  • How To Play The Deere & Company Earnings Announcement [View article]
    Thanks for noticing. This makes 8 successful plays in a row without a single loss. Average gain 22% after commissions. See the full record - http://bit.ly/17JUTcE.
    May 19, 2013. 12:29 PM | 1 Like Like |Link to Comment
  • How To Play The Sina Corporation Earnings Announcement [View article]
    The calendar spreads made 19% after commissions, making it a record of eight consecutive successful earnings plays I have made (average gain 22%) without a loss. Check them all out -
    http://bit.ly/17JUTcE.
    May 19, 2013. 12:26 PM | Likes Like |Link to Comment
  • How To Play The Deere & Company Earnings Announcement [View article]
    I closed out the DE options today (prematurely as it worked out) for a little more than a 15% gain after commissions. It was the seventh consecutive earnings gain I made over the past six weeks which netted over 100% in all - I will itemize them all at the Terry's Tips blog after the 8th (Sina) trade is finished tomorrow.
    May 16, 2013. 02:33 PM | 3 Likes Like |Link to Comment
  • How To Play The Deere & Company Earnings Announcement [View article]
    I sold the diagonal today at a nice gain and waiting to close the calendar probably until Friday. Could easily be a 30% gain. Keep our fingers crossed.
    May 15, 2013. 08:31 PM | 2 Likes Like |Link to Comment
  • How To Play The Sina Corporation Earnings Announcement [View article]
    I don't expect to ever own the stock. I will reverse the trades on Friday after the extremely high May premiums have fallen to their intrinsic value.
    May 14, 2013. 08:57 AM | Likes Like |Link to Comment
  • How To Play The Deere & Company Earnings Announcement [View article]
    My software shows a loss with those positions at any price below $89.50 (not enough downside coverage in my opinion) - you must not have entered the assumption that IV of the June options will fall after the announcement.
    May 13, 2013. 04:09 AM | Likes Like |Link to Comment
  • How To Play The Deere & Company Earnings Announcement [View article]
    You can collect almost as much by selling a May 92.5 and you only have to wait a few days to collect it, and then you can do the same thing with the June option if the May one expires worthless which the pattern suggests will happen.
    May 12, 2013. 08:41 AM | Likes Like |Link to Comment
  • How To Play The Green Mountain Coffee Roasters Earnings Announcement [View article]
    I closed most of mine out today at $4.50, the intrinsic value. It shouldn't get any worse than that but if the stock should tank tomorrow, maybe you could get more. I wanted to cash in and use the money for another play.
    May 9, 2013. 01:37 PM | 1 Like Like |Link to Comment
  • How To Play The Green Mountain Coffee Roasters Earnings Announcement [View article]
    The stock went up so much that I was unable to get more than the intrinsic value of the spread - $4.50. After commissions, I made a little over 20% for the trade. Not bad considering I was totally wrong with the direction the stock would move after earnings (the SBUX deal was the unexpected development that pushed it so much higher, and of course, I could not have anticipated that). Thanks for asking.
    May 9, 2013. 01:35 PM | 1 Like Like |Link to Comment
  • How To Play The Green Mountain Coffee Roasters Earnings Announcement [View article]
    You are probably just fine with the May short call although you will have to wait an extra week to close out the spread. It might even be a better move because historically the stock moves higher in the days and weeks following the announcement although it has often moved lower right afterwards.
    May 8, 2013. 02:52 PM | 1 Like Like |Link to Comment
  • How To Play The Green Mountain Coffee Roasters Earnings Announcement [View article]
    The trade platform I use at thinkorswim calls the weekly options that expire on May 10 the May2-13 series. The symbol is GMCR130510C57. I know it is confusing.
    May 6, 2013. 11:56 PM | Likes Like |Link to Comment
  • How To Play The Green Mountain Coffee Roasters Earnings Announcement [View article]
    Bill - I didn't read your article until after I had submitted mine - we both seemed to come out about the same place using different thought processes. Good work!

    The sheer magnitude of those short positions still causes me concern - those shorts have collectively lost over half a billion dollars since in the last quarter. That's real money.

    It will be interesting to watch this unfold. .
    May 6, 2013. 04:08 PM | Likes Like |Link to Comment
  • How To Play The Green Mountain Coffee Roasters Earnings Announcement [View article]
    Thanks for your kind words. I stayed up half the night writing it and now feel it was all worthwhile.
    May 6, 2013. 04:04 PM | 1 Like Like |Link to Comment
COMMENTS STATS
222 Comments
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