Patel:
IMO, Earnings reports from CPQ, INTC and MSFT this week could generate just enough "noise" and confusion for DELL to be brought back to the mid 90's, thereby increasing option expiry "pain" (see Ben A's max-pain). I think there is about a 50/50 chance of this happening, but I think that no matter what happens through mid-day Thursday, it's clear blue sky from there. Your July 100's are iffy, IMO.
However, I think your August 95's are looking good. A while back, I posted that if you think the stock will run to 120-ish, the 110's are your best bet, but if you think it will go higher, August 115's or 120's are better for maximum return. The 130's are expensive.
One thing I haven't fully considered about the August options is the possibility that Dell will not announce earnings until after the 21st (expiry day). I don't think it's likely, but I've noticed that some major companies, especially techs, announce the Monday after an expiration (not sure if this is intentional but suspect that it is). I think there will be plenty of advance warning if DELL came out after the 21st, so you could just roll your Augusts into Septs but it will probably cost you quite a bit of premium. That would be a bummer. Any other options players have any thoughts on this?
Rich |
