Jeng,
Thank you for your helpful input on SUNW. Relatively speaking, SUNW is one stock that has held up pretty nicely compared to rest of the tech sector. Another is CSCO. I believe the days of high flyers are nearing an end and the limited upside potential on SUNW may not warrant the purchase of a short-term straddle. If SUNW beats estimates, it may trade a couple of points higher but probably will have trouble holding on to gains in the current environment(quick profit taking). I am considering purchasing a longer-term straddle on SUNW or possibly buying stock and selling calls.
On IOMG,
The low volume does not trouble me because I know that this stock is a volcano waiting to explode, or fizzle, depending on earnings report. I feel IOMG is trading near fair value currently, as compared to 2 months ago when it was extremely overvalued. A healthy correction has occurred. I know of many who are long big positions in this stock and are waiting for a reason to buy more, but on the same token, there are many who are waiting to dump this stock after earnings release. I think the break of support in the SOX and the tanking of the Nasdaq is scaring many buyers away. Nasdaq holding above 1100 was critical. I picked up some IQGHF calls on friday and I am still expecting a run up to the 30 range before earnings. I will pick up the puts for the straddle the day before earnings. If I do not see a pre-earnings run I will then start to worry. But for now, the stock has been trading in its ST range between 26-29.
I am also considering going long on IOMG stock on Monday, selling Oct 30 calls and buying July 25 puts the day before earnings. This is a relatively safe strategy in my opinion and I will most likely take this position in addition to July straddle. If IOMG disappoints, expect a mass exodus by the institutions and the mainstream causing IOMG to easily drop 8-10 points on Friday. I am holding some cash to buy IOMG if this occurs. IOMG is one of my favorites. If the earnings are really good, the stock could easily trade in the 33-35 range on "panic buying" especially with the volatility of Opt Exp. IMO, the question is whether panic buying will outweigh quick profit taking. I think it will.
On ASND, I got rid of my July 55 calls with small profit on straddle position, which under last week's circumstances, I was happy. I try not to hold options during the week of expiration, unless it is an earnings straddle, because of the rapid decline in time value the few days before expiration. ASND looks to have a concrete ceiling at 60 but strong support at 55. I may pick up longer term calls if I see it at 55 again.
What is your strategy for IOMG?
Regards, |
