Watching The Tape
Futures are a tad better at this hour. April
Personal Income and Consumption was slightly positive with income in line (+0.3%
vs. expectations of +0.3%), and consumption lower than expected (+0.5% vs.
expectations of +0.7%). At 9:00 CDT, May consumer confidence (108.8 expected)
will be released along with April existing home sales (5.4 million expected).
The consumer confidence number is the biggie…
In Europe, the FTSE was down 0.5% to 5111, and the DAX was up 0.1% to 4967. In
Asia, the Nikkei was down 0.3% to 11,936, and the Hang Seng gained 0.2% to
11,582. I honestly don’t know what to expect today because it will still be
somewhat of a holiday market. Before the consumer confidence numbers, I’d be
sitting back and watching the tape, folks. Also, the dollar is back on its heels
Volatility hung tough Friday, which was impressive given the fact that
it was in front of a three-, four- or five-day weekend. The VIX gained 81 to
21.16, the VXN dropped .34 to 42.86, while the QQV gained .91 to 37.09.
Trade Updates (5/24/02)
PowerRating) — We were once again unable to buy any additional January 60 puts at
$3.30. The drug sector is getting pounded (with the exception of JNJ of course),
so we may not have a chance in the near future.
No other trades today.
New Actions (New Recommendations)
Working Orders (Old Recommendations)
PowerRating) — Holders of the DYN January 15 call/June 20 call proxy
buy-write (long the January 15 calls, short the June 20 calls at $3.20),
buy the June 20 calls (to close) and sell the September 17.5 calls (to open) for
$1.25 credit (to you).
Recap of open trades
AOL — Long the October 20 buy-write at $16.30
Call Spread Positions
- Options trading involves substantial risk and
is not suitable for all Investors.
- Also note that spread strategies involve
multiple commissions and are not risk-free. Most spreads must be done in a
- Because of the importance of tax
considerations to all options transactions, the investor considering options
should consult with a tax advisor as to how taxes may affect the outcome of
contemplated options transactions.
- Supporting documentation for claims,
comparisons, recommendations, statistics or other technical data will be
furnished upon request. One or more of the contributors to these
commentaries may have a position in one or more of the securities mentioned.
- It is important to note that the options
strategies discussed herein are not suitable to all investors. Options are
complex investment tools and involve substantial risk. Moreover spreading
strategies do not eliminate risk and involve multiple commissions.
- Note: All individuals must have read the ODD
carefully before trading options. To obtain the document, click on the OCC