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Robert Weinstein

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  • Between Nokia And Research In Motion, RIM Is The Safer Play [View article]
    Ref: $RIMM, $AAPL, $GOOG, $HPQ, $MSFT, $NOK, $ORCL, $T

    Hello Slick,

    Right, like I added this is NOT to be confused with call-put parity which means the pricing will be relative.

    There are several factors at play here and I will not go into all of them here but will paint a broad picture of what is happening.

    Let's start with a given put option with a strike of $15. We will add some other givens to keep it simple. The expiration is the front month and the stock is at $15 right now.
    If you buy the put the MOST you can make is $15 less the cost of the put. So we will say for easy math sake that you can make $15

    If you take the $15 call on the other hand you quickly will see the profit potential is greater than $15 because the stock can go to $30.01 and higher. This means there is greater risk selling a call than selling a put. greater risk = greater price all else being equal.

    What will likely also make sense is that as a stock moves higher in price the difference progressively gets smaller.

    One other important point is if you generally pay the spread (buy the asking price and sell the bid price) calls also usually make more sense all else being equal. This is because calls generally have greater liquidity and the spreads are lower. So always start out looking at calls and then after you have a frame of reference move to the puts and see how they are pricing out. You may find you can save a lot of money this way.

    I write about these things and other option related topics every week in the Rocco Pendola Options Newsletter. If anyone is interested please check it out.
    http://bit.ly/wbmj9l
    Apr 20 04:12 PM | Likes Like |Link to Comment
  • Netflix Needs To Change The Plan Or Change The Leadership [View article]
    Hi Finney,

    Thanks for reading and posting your thoughts.

    The thing is I would like to be a bull. I think I will be a bull again, just not until I see a much greater monetizing of the product.

    If we simply do some back of the envelope math we can find some interesting numbers.
    20 million subs
    2 visits a month ave
    4 pages per visit
    = 160 million page views per month
    2 ads related to movies, devices to play movies etc.. per page
    * $2 CPM rate for ads ($2 per thousand impressions)
    That's $300K per month in added revenue that they don't have to charge the customers for.

    You say they can't do things because of their financial straits, but I say they need to do things because of their financial straights/business model.

    Just some thoughts and I hope you do well with your shares through the earnings. Have a good weekend

    Bob
    Apr 20 01:13 PM | Likes Like |Link to Comment
  • Between Nokia And Research In Motion, RIM Is The Safer Play [View article]
    61,

    Thanks for reading and your comment. You may want to shift from writing puts to writing covered calls. You should find your results will be better.
    Not to be confused with call-put parity, calls will have greater premium with RIM than equal risk puts due to the greater profit potential in the calls.

    A penny or two here and there adds up quickly with the premium as low as it is per contract in real dollars. Of course this must be weighed with transaction and opportunity costs, but with commissions as low as they can be it can be mitigated or removed totally.

    Have a great weekend

    Bob
    Apr 20 12:59 PM | Likes Like |Link to Comment
  • Earnings Preview: Peabody Energy Reports Q4 Results Tuesday [View article]
    Hello Haleiwahu,

    Thanks for your kind words. I am not sure how I missed your comment for so long, but it was a pleasure to read it today.

    Have a great weekend

    Bob
    Apr 20 12:35 PM | Likes Like |Link to Comment
  • Mel Karmazin Sells 11 Million Shares Of Sirius And Nets $25 Million [View article]
    "You guys are all funny because now the story is no longer Sirius XM, it's "the evil authors who write about Sirius XM." Lol!"

    That's just funny......

    Good work Cameron (or whoever you are) and best of luck here and everywhere else!!

    Bob
    Apr 20 11:54 AM | 1 Like Like |Link to Comment
  • Netflix Needs To Change The Plan Or Change The Leadership [View article]
    You're not wrong, but you are comparing different PE ratios than I am. When looking at PE's I tend to focus on forward not ttm. Your PEs are based on the past, mine are the expected.
    Apr 20 11:07 AM | Likes Like |Link to Comment
  • ABB Dividend Capture Using Call Options [View article]
    Hi Kelly,

    right you understand correctly. You can't "avoid" the steamroller in the sense of not accepting the risk by magic. Options are a shift in risk so the only way to avoid risk is to buy another option (shift the risk) and create a spread. This will lower your potential profit, but at least the steamroller can be turned into a shopping cart or something less painful if it hits you.

    I like Tradestation as an option tool.
    Apr 20 10:29 AM | Likes Like |Link to Comment
  • Using Options To Help Get A Restful Night Of Sleep Before Apple's Earnings Release [View article]
    $AAPL has performed great and many can argue the price is really undervalued due to the high per share price. The market is emotional though and making the emotion pay you for your time appears to be a very effective method of lowering risk. Rocco Pendola talks about this in his newsletter http://bit.ly/wbmj9l
    Apr 20 10:17 AM | Likes Like |Link to Comment
  • Netflix Needs To Change The Plan Or Change The Leadership [View article]
    Thanks for reading my article and for your kind words. If the Board doesn't give me a call I sure hope they at least see to it that they stop leaving money on the table.
    Apr 20 10:11 AM | Likes Like |Link to Comment
  • Netflix Needs To Change The Plan Or Change The Leadership [View article]
    Hmmmmm, Seeking Alpha didn't produce this $NFLX article I did (subject to editorial improvements from the master wordsmith Michael - Thanks Michael for making me look so good!!). I can write about any stock I wish and with a bullish or bearish bias. In fact I have many bullish articles about NFLX. Seeking Alpha in my experience doesn't care in the slightest if an article in bullish or bearish. I should know, I used to be ranked number one in short ideas with most of my articles bearish. Never once did I encounter a rejection based on bias. Authors may have an agenda with so many different ones, but SA does not. I have over 600 articles and a thousand followers, so it's likely I know what I am talking about here. This is a site where everyone has a voice and everyone can decide based on an easy to search method of article history to determine the value provided by any given author.

    I can't speak for anyone else, well maybe I can. I talk to Rocco Pendola once in a while and if you read his options newsletter http://bit.ly/wbmj9l you would know in greater detail his thoughts and the fact he has his own money in a short position with NFLX
    Apr 20 09:41 AM | Likes Like |Link to Comment
  • Netflix Needs To Change The Plan Or Change The Leadership [View article]
    You make a possible valid point with $AAPL although I would suspect it would not happen. Microsoft, while a cash printing press is still lumbering around trying to figure out where to go next. I doubt they would do anything to rock the boat in such a fashion.
    Apr 20 09:29 AM | Likes Like |Link to Comment
  • Using Options To Help Get A Restful Night Of Sleep Before Apple's Earnings Release [View article]
    Options are quoted per share and are for 100 shares in almost all situations. $AAPL has a lot of liquidity in the options due to the per share price and overall marketcap.
    Apr 18 07:56 PM | Likes Like |Link to Comment
  • Using Options To Help Get A Restful Night Of Sleep Before Apple's Earnings Release [View article]
    Thanks for reading the article, but it would appear you missed the main point. The main point is to hedge shares you may already have if you are worried about earnings.

    I provided two different thoughts on how to do this. Many people don't know how options may assist in hedging and provide lower volatility. Of course an article is not going to say buy X strike at X month and hold for X days because everyone and every portfolio has different needs and risk tolerance.

    If I provide a new idea or a reminder for some investors I consider it a success. Nothing about investing is "easy" and that's why people read my articles, to take some of the confusion away.
    Apr 18 03:12 PM | 1 Like Like |Link to Comment
  • Using Options To Help Get A Restful Night Of Sleep Before Apple's Earnings Release [View article]
    You bring up a very good question. May calls are the front month for earnings. Because they are the front month they can be expected to have the highest implied volatility into earnings. After earnings the May strike can be expected to fall the most as well.

    So May offers the most premium relative to the amount of time a buyer receives. This is a starting point of ideas though and for any given investor different strikes/expiration dates may make more sense (or not hedging at all).
    Apr 18 03:08 PM | Likes Like |Link to Comment
  • ABB Dividend Capture Using Call Options [View article]
    Earnings is always a big deal and so that must be factored in. At the same time it's the earnings driving the IV higher on the options allowing for what should be a good risk to reward ratio for some. What one must be careful of is to avoid picking up nickels in front of a steamroller...
    Apr 17 09:48 PM | Likes Like |Link to Comment
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