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Options Trading

TradeKing Midday Market Call Recap - SPX, OXY

Options Trading TradeKing

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Recap for Tuesday, August 19th by Kevin Corrigan here
Analysis of S&P 500 from  QuickTakesPro’s Michael Kahn -

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The Chart of the Day is Occidental Petroleum. (OXY) - Analysis of OXY Volatility Chart and Dividends from TradeKing’s Brian Overby

Technical Tools Used:

Moving Averages

- Trendlines

Brian Overby’s paper trade strategies based on Michael’s analysis - 

Michael's analysis is bullish. Brian discusses two strategies, a shorter term Long Call Spread that is more aggressive (the expiration is before the ex-dividend date) and a more conservative Short Put Spread that expires after. 


Brian’s Paper Trade - Long Call Spread 

 - Buy 1 Sep 5 2014 OXY 100 Call

- Sell 1 Sep 5 2014 OXY 104 Call

- 17 Days to expiration

- Net Bid 1.94, Mid 2.00, Ask 2.07 for the Spread 

- Net Debit is $2.00, if we execute at the Mid (might not be possible).

- Maximum potential loss: $2.00

- Maximum potential gain is $2.00

Total commission to enter this trade is $6.25

Brian’s Paper Trade - Short Put Spread 


- Sell 1 Sep 26 2014 OXY 101 Put

- Buy 1 Sep 26 2014 OXY 99  Put

- 38 Days to expiration

- Net Bid 0.67, Mid 0.76, Ask 0.84 for the spread

- Net Credit is $0.76, if we execute at the Mid (might not be possible).

- Maximum potential loss: $1.24 

- Maximum potential gain is $0.76

Total commission to enter this trade is $6.25


**NOTE: option prices are given as a per contract amount. Multiply loss and gain figures by 100 shares and by the number of contracts traded to determine the amount of the full potential loss or full potential gain. No additional calculations are needed to determine commission costs.

TradeKing Options Tools used:

- Detailed Quote

- TradeKing Long Call Spread

- TradeKing Short Put Spread

- TradeKing Volatility Charts

- TradeKing Options Pricing Calculator
- TradeKing P&L Calculator

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