My play for this week.....MO

#1 12-13-2005, 01:24 AM

MO (Altria) has a huge court ruling coming on Thursday. Some analysts think it may run 10% if the appeal is won by MO. Its $72.50 now, the December 75 calls are .35 or so now. Worth the risk of $350 for 10 calls for a possible large run on the court ruling. Also, you can straddle and get the Dec 70 Puts too for .40. Total would be .70-.75 for the options, stock could run large either way this week. They expire on Friday.

Im a Day trader for a living, specialize in options....

#2 12-13-2005, 11:47 AM

Well dammit the options ran 400% today on the news of the ruling this week.... well, it WAS a good idea....

Now I got some MO shares and sold covered Dec 70 calls. $1.60 premium. 75%+ chance of a favorable ruling. I will take that risk. If MO tanks, I can hold, it will be appealed anyway, and can always sell new calls further out...

Evan · #3 12-13-2005, 11:50 AM

[ QUOTE ]
Well dammit the options ran 400% today on the news of the ruling this week.... well, it WAS a good idea....

[/ QUOTE ]
You're a full time trader and you didn't see this coming?

#4 12-13-2005, 02:10 PM

I did see this coming, but I did not know the exact date of the decision until yesterday after the close, so too late to get the options then. Been a crazy week for me with other things, so havn't had as much time to research.

Evan · #5 12-13-2005, 02:22 PM

[ QUOTE ]
I did see this coming, but I did not know the exact date of the decision until yesterday after the close

[/ QUOTE ]
That's my point. Based on the price of the options yesterday and today, I'm guessing no one did.

#6 12-13-2005, 02:55 PM

I know....sure woulda been great to get the spread at .70 yesterday, now like $4. Damn. I think the risk of it going down is low compared to the $1.60 premium still on the Dec 70 calls. I will take a shot. Worst case is MO falls, they appeal, and it comes back up, and I keep the $ from the option sales plus whatever future calls I will sell. Not too worried. $1.60 premium is nice on a couple thousand shares for 3 days if it all works out.