Weekend Updates - Archive

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    Posted: 24 August 2012 10:49 PM #31

    What is the best guess as to what an event like this does to volatility on Monday? Up or down?

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    Long AAPL Short ME 5’3

         
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    Posted: 24 August 2012 10:58 PM #32

    Let’s hear your guess.

    I have my theory.  I assume you mean implied volatility.

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    The Summer of AAPL is here.  Enjoy it (responsibly) while it lasts.
    AFB Night Owl Team™
    Thanks, Steve.

         
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    Posted: 24 August 2012 11:02 PM #33

    Phoebear611 - 25 August 2012 01:42 AM

    Can Samsung sabotage them in any way with respect to the parts they need from Samsung for AAPL products? (I still don’t understand that whole relationship)

    No way in hell.

    Not only is Samsung not financially incented (weird form of “incentive”, ain’t it) to cut off its nose to spite its face (Apple being a huge customer, and Apple _gets along_ with Samsung’s component subsidiaries just fine so I hear), it would look so damn obvious if Samsung dared to undercut Apple in any way.

    Also, Apple’s got all kinds of contingency plans and alternate suppliers.  AND, it’s probably hyper-testing all products with Samsung components and poring ‘em over with electron scanning microscopes and stuff just in case.

    Apple and Samsung are just more frenemies than ever.

    [ Edited: 24 August 2012 11:05 PM by Mav ]

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    The Summer of AAPL is here.  Enjoy it (responsibly) while it lasts.
    AFB Night Owl Team™
    Thanks, Steve.

         
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    Posted: 24 August 2012 11:08 PM #34

    Mav - 25 August 2012 01:58 AM

    Let’s hear your guess.

    I have my theory.  I assume you mean implied volatility.

    I’m still trying to get a handle on how IV moves at all. It still seems like a little bit of black magic to me.

    I did not expect IV to get crushed after the last earnings because I thought wild stock swings would increase IV, so I’m assuming it meant the price outlook was not good, hence IV goes down.

    If that is the case, I would think with all of the events on the horizon plus a big win now, IV should shoot up.

    But I really don’t know all that much smile

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    Long AAPL Short ME 5’3

         
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    Posted: 24 August 2012 11:11 PM #35

    cambrose - 25 August 2012 02:08 AM

    But I really don’t know all that much smile

    Actually I do know I’m really happy those last 10 Jan 2013 700 calls filled in the last 5 minutes of trading today. :D

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    Long AAPL Short ME 5’3

         
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    Posted: 24 August 2012 11:15 PM #36

    IV crushes “always” seem to happen after earnings…I’m not so clear on the why, it’s some bid/ask mechanism related to the removal of tremendous uncertainty and what’s important is the knowledge that it happens.

    I think you can make a good case for any type of IV move, including not much of one.

    It would’ve been easier to _attempt_ to isolate IV had AAPL not had that nice, and also kinda volatile, run this week.  But I do know that any IV drop from the “end” of the Apple-Samsung trial event could easily be trumped by AAPL going up another 10 or so points on Monday (buying frenzy?  In the last week of August?) combined with new iPhone media invite/new iPhone anticipation in general.

    So, I’m betting…IV is up a little Monday.  A VXAPL of around 30 is on the “high side” so far this far so I’d be a little cautious with calls around current IV levels.

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    The Summer of AAPL is here.  Enjoy it (responsibly) while it lasts.
    AFB Night Owl Team™
    Thanks, Steve.

         
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    Posted: 24 August 2012 11:15 PM #37

    cambrose - 25 August 2012 02:11 AM
    cambrose - 25 August 2012 02:08 AM

    But I really don’t know all that much smile

    Actually I do know I’m really happy those last 10 Jan 2013 700 calls filled in the last 5 minutes of trading today. :D

    Provisionally, I’d say that was a good move. smile

    Signature

    The Summer of AAPL is here.  Enjoy it (responsibly) while it lasts.
    AFB Night Owl Team™
    Thanks, Steve.

         
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    Posted: 24 August 2012 11:36 PM #38

    As mentioned by Ken in the Braeburn Group

    I expect a number of positive analyst upgrades Monday morning.  The court ruling provides perfect cover for analysts to change their forecast & price targets, esp. those with underwater targets.

    There will be laggards.  The analysts who want good PR will do some upgrades.

         
  • Posted: 24 August 2012 11:44 PM #39

    I am curious if covered calls can be exercised after the market close today. CBOE says from 8AM—3PM Friday but I read on a blog that usually it is after the market closes. I sold 3 contracts at 665 and it looked as if I would keep them as of the close but I am wondering if they could be taken after the news broke around 5:45PM eastern. Could be a slight hickey if they were taken. Does anyone know if there is a rule on this?  Thanks and congrats to all who are long.

         
  • Posted: 24 August 2012 11:51 PM #40

    Platon - 25 August 2012 02:44 AM

    I am curious if covered calls can be exercised after the market close today. CBOE says from 8AM—3PM Friday but I read on a blog that usually it is after the market closes. I sold 3 contracts at 665 and it looked as if I would keep them as of the close but I am wondering if they could be taken after the news broke around 5:45PM eastern. Could be a slight hickey if they were taken. Does anyone know if there is a rule on this?  Thanks and congrats to all who are long.

    From what I’m reading, 5:30pm seems to be the deadline for investors to contact their broker and exercise. So I think you’re safe, but don’t quote me on that.

         
  • Posted: 25 August 2012 12:06 AM #41

    AppleDoc - 25 August 2012 02:51 AM
    Platon - 25 August 2012 02:44 AM

    I am curious if covered calls can be exercised after the market close today. CBOE says from 8AM—3PM Friday but I read on a blog that usually it is after the market closes. I sold 3 contracts at 665 and it looked as if I would keep them as of the close but I am wondering if they could be taken after the news broke around 5:45PM eastern. Could be a slight hickey if they were taken. Does anyone know if there is a rule on this?  Thanks and congrats to all who are long.

    From what I’m reading, 5:30pm seems to be the deadline for investors to contact their broker and exercise. So I think you’re safe, but don’t quote me on that.

    Thank you Appledoc. I hope that is correct and I guess I shouldn’t care since I would make money on the option anyway but it is human nature to always hope for the very best outcome.

         
  • Posted: 25 August 2012 12:36 AM #42

    cambrose - 25 August 2012 01:49 AM

    What is the best guess as to what an event like this does to volatility on Monday? Up or down?

    I don’t think this does much at all to volatility.  IV is coming off yearly lows and typically peaks a lot higher than it has gone.  That usually coincides with earnings so I would say we have some time for it to go up into earnings.

    But what do I know… :-D

         
  • Posted: 25 August 2012 01:00 AM #43

    cambrose - 25 August 2012 02:08 AM
    Mav - 25 August 2012 01:58 AM

    Let’s hear your guess.

    I have my theory.  I assume you mean implied volatility.

    I’m still trying to get a handle on how IV moves at all. It still seems like a little bit of black magic to me.

    I did not expect IV to get crushed after the last earnings because I thought wild stock swings would increase IV, so I’m assuming it meant the price outlook was not good, hence IV goes down.

    If that is the case, I would think with all of the events on the horizon plus a big win now, IV should shoot up.

    But I really don’t know all that much smile

    You have to understand, IV is just a measure of investor sentiment.

    EDIT: It is merely what volatility would justify the current options prices,  so roughly speaking it reflects investors’ expectations about short term future volatility.

    EDIT 2: It figures, I get up and walk away from the computer and the phrasing I was searching for finally came to me: IV is not an external force acting on options prices, and it is misleading to think of it that way.

    [ Edited: 25 August 2012 01:26 AM by greedyn00b ]      
  • Posted: 25 August 2012 01:04 AM #44

    Well, hey just realized we switched to the weekend thread hours ago, so maybe I should re-post what I posted to intraday a few minutes ago:

    Good freakin? god, it just keeps on coming: this afternoon the ITC ruled against Motorola?s request for an import ban on iPhone & iPad, finding that they did not infringe 3 of 4 patents Googorola was claiming are infringed. (The 4th claim is being re-reviewed after the initial ruling against Moto.)

         
  • Posted: 25 August 2012 01:09 AM #45

    Mav - 25 August 2012 12:52 AM

    You can read Samsung’s response if you like.  I’ve chosen not to post it. wink

    Aww, come on, you should’ve at least posted the first 11 words: “Today’s verdict should not be viewed as a win for Apple…”

    wink wink wink wink wink wink wink wink wink winkwink wink wink wink wink wink wink wink wink wink wink wink