Story by Michael Keane
Well, well, well.
Netflix has taken Apple's lead and with one move, just created the possibility of shareholders to become immensely wealthier in the future.
The company announced today that they are splitting their stock 7 to 1 (Bloomberg story link here). That means that every shareholder will now have seven shares for every share they originally purchased. This is amazing news!
It is amazing news. This has opened up the options market to thousands of investors. For every investor that owns just 15 shares today, you will now own 105 shares. This will allow each of these investors the opportunity to sell call options on Netflix. That can be an extra stream of revenue that can go on forever. This is one of the ways that wealth can be built. With Netflix being a volatile stock, the options pricing should be fairly high.
**All
posts on this blog are information and opinions only. They are not to
be considered recommendations to buy or sell any security. Please do
your due diligence first before trading and investing. Please direct all
questions and comments to the blog or to kdkfund@gmail.com or on
twitter @kdkfund.
Showing posts with label Call Options. Show all posts
Showing posts with label Call Options. Show all posts
Tuesday, June 23, 2015
Saturday, January 11, 2014
KDK Fund Activity for Week Ending 1/11/14 (UUP, more)
UUP Option Trade
UUP ended the week at $21.67. The Jan 24 $21.50 call option bid price is now $0.18. That is a drop of $0.08 from last week. The option trade will continue as there is still a probability that the price of the ETF will rise due to upcoming economic reports being released in the next two weeks.
KDK Stock Fund
The plan is to make a purchase next week. The Fund will be purchasing shares of the Realty ETF Realty Income Corp.. The symbol for this ETF is O. Currently, the price of O is $38.50. Reasons for the trade include a monthly dividend and decent current valuation.
Other stocks on the future purchase list include Starbucks, Verizon, Ford, and Costco. KDK is always looking investment ideas. KDK Fund can be reached at kdkfund@gmail.com.
**All posts on this blog are information and opinions only. They are not to be considered recommendations to buy or sell any security. Please do your due diligence first before trading and investing.**
UUP ended the week at $21.67. The Jan 24 $21.50 call option bid price is now $0.18. That is a drop of $0.08 from last week. The option trade will continue as there is still a probability that the price of the ETF will rise due to upcoming economic reports being released in the next two weeks.
KDK Stock Fund
The plan is to make a purchase next week. The Fund will be purchasing shares of the Realty ETF Realty Income Corp.. The symbol for this ETF is O. Currently, the price of O is $38.50. Reasons for the trade include a monthly dividend and decent current valuation.
Other stocks on the future purchase list include Starbucks, Verizon, Ford, and Costco. KDK is always looking investment ideas. KDK Fund can be reached at kdkfund@gmail.com.
**All posts on this blog are information and opinions only. They are not to be considered recommendations to buy or sell any security. Please do your due diligence first before trading and investing.**
Tuesday, January 7, 2014
Is Oil Ready To Drop?
One of the ways that KDK Fund makes money is through short term (less than 6 months) speculative options trading. For example, KDK Fund currently owns a UUP (US Dollar) $21.50 call with an expiration of January 24th. The most recent status of the trade can be found here. KDK Fund is regularly learning about other opportunities.
One such opportunity that is starting to gain favor with KDK Fund is the idea that oil prices are set to fall for 2014. There are a few items that KDK Fund has found to support this argument.
One major piece of the argument rests in the fact that the world is starting to produce a growing amount of oil. So much so that there are multiple reports now that the rate of growth is to outpace the growth of the refining ability and global GDP estimates. In the United States, oil growth is getting to a point where projections are that the US will be oil independent in the next 5-7 years. Mexico is looking to release land that was under government control to private oil companies for exploration research. This could nearly double output. When you add oil output from Iraq and other places in the Middle East on the market, the result should be pressure on the market price.
Another large item that supports this view is the expected rising value of the US Dollar. As the dollar increases in value, the price of oil should decrease accordingly. With the Federal Reserve decreasing their QE assistance, the value of the US Dollar should increase. This is part of the reason the current dollar trade is going on.
The USO ETF is nearing multi year support in the $32.00 region. A break of that could drop the ETF to $30.00 first and a continuation to as low as $25.00.
KDK Fund will be watching the ETF USO with eyes particularly on the put side of the options market. No trade is planned yet; just research. Any action taken will be reported.
**All posts on this blog are information and opinions only. They are not to be considered recommendations to buy or sell any security. Please do your due diligence first before trading and investing.**
One such opportunity that is starting to gain favor with KDK Fund is the idea that oil prices are set to fall for 2014. There are a few items that KDK Fund has found to support this argument.
One major piece of the argument rests in the fact that the world is starting to produce a growing amount of oil. So much so that there are multiple reports now that the rate of growth is to outpace the growth of the refining ability and global GDP estimates. In the United States, oil growth is getting to a point where projections are that the US will be oil independent in the next 5-7 years. Mexico is looking to release land that was under government control to private oil companies for exploration research. This could nearly double output. When you add oil output from Iraq and other places in the Middle East on the market, the result should be pressure on the market price.
Another large item that supports this view is the expected rising value of the US Dollar. As the dollar increases in value, the price of oil should decrease accordingly. With the Federal Reserve decreasing their QE assistance, the value of the US Dollar should increase. This is part of the reason the current dollar trade is going on.
The USO ETF is nearing multi year support in the $32.00 region. A break of that could drop the ETF to $30.00 first and a continuation to as low as $25.00.
KDK Fund will be watching the ETF USO with eyes particularly on the put side of the options market. No trade is planned yet; just research. Any action taken will be reported.
**All posts on this blog are information and opinions only. They are not to be considered recommendations to buy or sell any security. Please do your due diligence first before trading and investing.**
Saturday, January 4, 2014
KDK Fund Week Ending Jan 3 (UUP Call Trade, Upcoming Purchases and more)
Hey everyone
The current UUP $21.50 January 24th call option trade will continue.. The bid price of the options is currently $0.26. The target price of the option is still $0.75. UUP moved up during the week to $21.74.
Preparations for upcoming stock and ETF purchases continue. The first purchase should be coming in the next week or so.
**All posts on this blog are information and opinions only. They are not to be considered recommendations to buy or sell any security. Please do your due diligence first before trading and investing.**
The current UUP $21.50 January 24th call option trade will continue.. The bid price of the options is currently $0.26. The target price of the option is still $0.75. UUP moved up during the week to $21.74.
Preparations for upcoming stock and ETF purchases continue. The first purchase should be coming in the next week or so.
**All posts on this blog are information and opinions only. They are not to be considered recommendations to buy or sell any security. Please do your due diligence first before trading and investing.**
Saturday, December 21, 2013
KDK Fund Dec 21 Weekly Report (IAU, UUP, REIT, and more)
KDK Fund had the busiest week in its existence so far. It was a whopping 2 trades :). KDK Fund sold its December IAU $12.00 Put. You can read about it here. It also bought a Jan 4th week UUP $21.50 call option. You can read about the specifics including why the trade was made here.
KDK Fund also found a Real Estate REIT named Realty Corp. that it will purchase shares of in 2014. The dividend is currently at 5% and is given on a monthly basis.
**All posts on this blog are information and opinions only. They are not to be considered recommendations to buy or sell any security. Please do your due diligence first before trading and investing.**
KDK Fund also found a Real Estate REIT named Realty Corp. that it will purchase shares of in 2014. The dividend is currently at 5% and is given on a monthly basis.
**All posts on this blog are information and opinions only. They are not to be considered recommendations to buy or sell any security. Please do your due diligence first before trading and investing.**
Friday, December 20, 2013
New Trade in UUP Jan $21.50 Call Option
A new options trade has been made for KDK Fund. The January week 4 UUP $21.50 call option has been purchased for $0.25. UUP is currently trading at $21.67. The goal for the trade is $0.75. The trade will end on Friday, January 24th. Reasons for the purchase are as follows:
- Recent Federal Reserve decision to taper QE
- Increased GDP points to further strength in economy and further tapering of QE
- Increased GDP of previous quarter points to possible upward revisions of current quarter.
- Possible double bottom forming a W formation (there are 3 W formations marked previously in the chart).
- Japan and Europe still in the middle of their own QE programs
- US Government passing actual budget that provides more stability to market and economy
- Cost of trade showed only $0.08 of time value when the trade was made.
**All posts on this blog are information and opinions only. They are not to be considered recommendations to buy or sell any security. Please do your due diligence first before trading and investing.**
- Recent Federal Reserve decision to taper QE
- Increased GDP points to further strength in economy and further tapering of QE
- Increased GDP of previous quarter points to possible upward revisions of current quarter.
- Possible double bottom forming a W formation (there are 3 W formations marked previously in the chart).
- Japan and Europe still in the middle of their own QE programs
- US Government passing actual budget that provides more stability to market and economy
- Cost of trade showed only $0.08 of time value when the trade was made.
**All posts on this blog are information and opinions only. They are not to be considered recommendations to buy or sell any security. Please do your due diligence first before trading and investing.**
Wednesday, October 30, 2013
Options Plan for 2014
Hey all
The options plan for the KDK Fund will consist of using a portion of funds to speculate on stock and ETF options in order to capitalize on momentum moves. The focus of the options account will be to find options on stocks or ETF's that have the likely hood of a large enough move in either direction during a particular period of time so that it can produce 100%+ returns on the option purchased. After commissions, taxes, and fees are taken out of winning trades, 50% of the rest of the profit will be put into the stock/bond portion of the fund. A losing trades max loss will occur at the 50% level. A rules base is being created to find the options that will be traded.
There are many reasons why a particular option will be purchased. Technical and fundamental research will be used for analysis. News will be a big driver. Time frames on the options will vary. There could be an earnings release with plenty of volatility within the stock or ETF. There could be a government decision made that will affect currency and general stock markets. There could be a management shakeup. There could be a natural disaster. The stock or ETF could be in a very predictable trend. There could be speculation of a merger.
** This blog is just information regarding a particular fund. It is not to be taken as a recommendation to buy or sell any security. Do your own due diligence.**
The options plan for the KDK Fund will consist of using a portion of funds to speculate on stock and ETF options in order to capitalize on momentum moves. The focus of the options account will be to find options on stocks or ETF's that have the likely hood of a large enough move in either direction during a particular period of time so that it can produce 100%+ returns on the option purchased. After commissions, taxes, and fees are taken out of winning trades, 50% of the rest of the profit will be put into the stock/bond portion of the fund. A losing trades max loss will occur at the 50% level. A rules base is being created to find the options that will be traded.
There are many reasons why a particular option will be purchased. Technical and fundamental research will be used for analysis. News will be a big driver. Time frames on the options will vary. There could be an earnings release with plenty of volatility within the stock or ETF. There could be a government decision made that will affect currency and general stock markets. There could be a management shakeup. There could be a natural disaster. The stock or ETF could be in a very predictable trend. There could be speculation of a merger.
** This blog is just information regarding a particular fund. It is not to be taken as a recommendation to buy or sell any security. Do your own due diligence.**
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