Wednesday, April 30, 2008

AKAM ER Play

Just got in for the ER play, neutral to slightly bullish bias, doubt it would move a lot after ER, but I guess I need to learn something here, so here it goes:

Long Straddle Strategy
** Bought 5 May 35 put -$750 ($1.5)
5 May 35 call -$1200 ($2.4)
Total risk: -$1950

we'll see....

4 comments:

RazoR said...

buffalo wild wings? You are a madman, shorting aapl? you are a god....still up 12pts on v over here...nice aggro trading Wabbit!

flyingwabbit said...

razor:
I counted, there are ONLY 5 words in your sentence that separated madman and god, so guess I am something in between :)
Nice trade on V, but somehow, I am still holding the bearish thoughts on V ever since its IPO, maybe I will act on my gut feeling again someday!
AKAM is pinned down the the close price after the ER, I will see how much tuition I will have to pay tomorrow.
Decided not to initiate any SW-S positions today, I need to see how market acts after digesting the FOMC decision overnight. The ideal short situation would be that the market/stocks gap-up or spike up in the early going tomorrow morning, fail to break today's high and then roll over..

RazoR said...

all stochastics for the dow and stocks are topped out, I expect the market to drop at least 2-300 points, but it seems the market is rising on lithium and lack of super bad news, so hedging is key...but I digress, how or why did you play bwld and know the swing would profit wtf?

flyingwabbit said...

Razor:
I agree with your assessment of the market. As for BWLD, it has a history of big move after ER, but I was not sure which way it would go, so the straddle strategy is perfect for such case, as long as there is a 5% or more of move, the chance of profit is good, obviously the bigger the move, the larger the profit, I got lucky that it rose as much as 22% today. By the same token, looks like my AKAM straddle won't be a winner tomorrow as it moved little after ER....