Monday, July 11, 2011

June Trade of the Day Review

Hat tip to Craig for pointing out that we didn't do a June "Trade of the Day" review. Here is my  review: 

June 1st: A trader executed a TLT June $96/$99 ratio call spread, 5,000x10,000 for an $0.83 debit.  Tough call here... really depends on how they traded this spread.  I could see some one trading it profitably and unprofitable.   We'll count it as a loss for our example. 

May 13th: A trader put on the RL  June 1x2 $135/$125 ratio put spread for a $1.40 debit, 1,000x2,000.  Stock drop'd hard on the May 25th and closed at 124 on expiration.  Clear huge winner. 

May 18th:  Apple June $370/$375 bear call spread @ .26.  Max gain winner. 

May 23rd: A trader bought 20,000 GLD June $145/$140 put spreads at $1.  Loser. Looking back at it looks more like a hedge of long stock. 

May 4th: A trader sold 4,240 Macy June $27 calls at $0.41 and sold 4,240 June $23 puts at $0.38 for a credit of $0.79 or $334,960.  Not a max gain winner (off by .02) but a clear winner. 

May 3rd: A trader bought 10,000 June TLT $96 calls at $0.74, sold 20,000 June $98 calls at $0.36, and bought 10,000 June $100 at $0.18 for a debit of $0.20.  Spread was worth .90 on expiration so a clear winner.  Probably could have traded it even better. 

April 28th: A trader sold 3,000 TER June $18 calls at $0.25 and bought 3,000 June $16 calls at $1.10 for a debit of $0.85 or $255,000.  Trade might have been worth more a week after it was bot but we'll call it a loser since it was worthless at expiration. 

April 20th: A trader sold 7,500 AA June $16 puts at $0.42 and bought 7,500 June $18 calls at $0.26 for a credit of $0.16 or $120,000.  Trade killed it the following week. The stock closed its gap 12 trading days after it was put on. Clear winner.  Hard to image someone holding this until expiration without blowing out or adjusting. 

April 14th: A trader sold 15,000 CSCO June $16 puts at $0.34, bought 15,000 June $18 calls at $0.47, and sold 15,000 June $20 calls at $0.12 for a debit of $0.01 or $15,000.  Same as above.  Stock rallied into earnings.  Hard to image someone holding though earnings. Winner. 

Feb 7th: A trader sold 550 V June 65 puts at 1.76 and bought 550 June 85 calls at 1.16 for a credit of 0.60 or 33,000.  Winner.
Feb 2nd:  a trader bought 125,000 C June 5.5 calls @ 0.16 and sold 125,000 June 6 calls @ .07 for a net debit of .09 or $1,125,000.  This was a winner as they unwound it before the 10:1 stock split. 

11 trades. 8 winners. 3 losers. 

Obviously it depends on how people trade these but not bad for reading option flow. 

 *Special thanks to Option Radar, BMO Capital, MEB Options, LiveVolPro, CBOE, Option Monster, T.O.P. group, and all of the options desks and traders we work with to provide the option flow! No position at this time. 

Position declarations are believed to be accurate at time of writing but may change at any time and without notice.

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