Ira,
I humbly admit that I underestimated the .43, but interestingly enough I emerged relatively unscathed.
Tuesday's trading blotter on the Feb 40 puts just before the close showed trades at 1/2, my 50 contracts included. Although the bid on these puts went as low as 3/16ths this morning, I held off as CPQ came off, to cover at 7/16ths this afternoon. Lost 1/16. Had I been right about earnings, Cpq could have conceivably come off $5 or $6, that would have made the puts trade around $1 1/2.
Not the worst risk reward ratio in the world.
Going forward, I believe either CPQ stuffed the channels, or, the acquisition of DEC is finally kicking in big time. If I determine it is the latter, then I will sell naked puts
I am prepared to play CPQ either way, as I am totally ambivalent. Regardless, I still think Dell is the far superior play as far as the box makers go
JMHO
Gene Piccoli |
