Q & A on Option Strategies
Q. Why is a call calendar spread better than buying a straight call?
A. Because you are using OEMIM (Options Exchange Market Investor’s Money to lower your investment cost and risk )
When you buy a longer term call it will hold it’s value, whereas the short term call will lose it’s time value premium as time approaches expiration date.
That delivers Options Market Money to the investor who made the call calendar spread trade.
Visualize an hourglass filled with pure gold dust and the buyer (owner of the hourglass) is the beneficiary by the passage of time.
Example: HOG 50.77 + 1.35
Buy a Nov 52.50 call for 2.88
Sell an Aug 52.5 call for 1.50
Net investment cost 1.38
If HOG is below 52.5 by Aug. 19 expiration date, sold call will be “0”
The long call buyer gained 1.50 premium
Now they may sell a Sept 52.5 call for another 1.50 premium to bring the cost of the Nov call to a credit of .12 (Free ride) etc.
If HOG rises to 55 their Nov 52.5 call will be worth 4.50 + or – or $450 per contract (10 contracts = $4500)
Stock Picks for Diagonal Call Spreads
| Underlying Stock | Price at Purchase | Price Gain | %Gain | Session Volume Traded |
| AAL | 45.99 | +1.68 | +3.79% | 14, 415, 233 |
| AAPL | 115.50 | +1.74 | +1.53 | 41, 498, 314 |
| ABT | 43.50 | +1.3 | +3.08% | 12, 439, 722 |
| ADBE | 88.46 | +2.33 | +2.71% | 3, 547, 138 |
| ADM | 46.70 | +1.41 | +3.11% | 3, 118, 621 |
| AMC | 26.00 | +0.51 | +2.00% | 148, 187 |
| AMZN | 563.91 | +8.14 | +1.46% | 7, 662, 138 |
| APA | 45.97 | +0.89 | +1.97% | 3, 549, 002 |
| APC | 73.00 | +1.45 | +2.03% | 3, 307, 632 |
| BA | 146.31 | +5.12 | +3.63% | 6 , 966, 103 |
| BABA | 70.99 | +1.51 | +2.17% | 10, 783, 757 |
| BBBY | 58.69 | +0.97 | +1.68% | 2, 162, 432 |
| BBRY | 7.15 | +0.07 | +0.99% | 4, 369, 196 |
| BBY | 35.16 | +0.32 | +0.92% | 2, 676, 128 |
| BIG | 47.04 | +0.07 | +0.15% | 654, 494 |
| BMY | 63.18 | +0.67 | +1.07% | 7, 907, 826 |
| BRCM | 52.53 | +0.97 | +1.88% | 6, 477, 572 |
| COST | 158.15 | +2.94 | +1.89% | 2, 192, 164 |
| CRUS | 32.44 | -0.45 | -1.37% | 1, 946, 726 |
| CSCO | 29.01 | +0.73 | +2.58% | 32, 091, 892 |
| CSX | 28.13 | +0.64 | +2.33% | 7, 064, 847 |
| CVS | 104.29 | +1.00 | +0.97% | 6, 147, 668 |
| DDD | 12.26 | +0.17 | +1.41% | 1, 953, 054 |
| DG | 66.95 | -0.60 | -0.89% | 5, 224, 309 |
| DLTR | 64.80 | +0.52 | +0.81% | 2, 983, 071 |
| DOW | 49.92 | +2.44 | +5.14% | 26, 689, 913 |
| DVN | 44.75 | +0.85 | +1.94% | 4, 389, 186 |
| GD | 147.26 | +4.16 | +2.91% | 1, 330, 657 |
| GIS | 59.23 | +2.25 | +3.95% | 4, 469, 283 |
| GLW | 17.60 | +0.89 | +5.33% | 41, 476, 910 |
| GM | 35.42 | 0.00 | 0.00% | 22, 695, 433 |
| GRMN | 35.06 | +0.96 | +2.82% | 1, 160, 514 |
| GRPN | 3.68 | +0.04 | +1.10% | 4, 994, 285 |
| GT | 32.57 | +0.08 | +0.25% | 2, 625, 486 |
| HD | 124.36 | +1.06 | +0.86% | 5, 855, 133 |
| HOG | 48.11 | +1.08 | +2.30% | 6, 748, 748 |
| HPQ | 28.77 | +0.54 | +1.91% | 7, 964, 921 |
| IBM | 144.09 | +3.17 | +2.25% | 5, 568, 282 |
| INTC | 34.40 | +1.03 | +3.09% | |
| INTU | 96.86 | +2.99 | +3.19% | |
| K | 72.01 | +2.40 | +3.45% | |
| LEN | 51.84 | -0.25 | -0.48% | 3, 084, 263 |
| LMT | 216.51 | +4.95 | +2.34% | 1, 190, 150 |
| LOW | 73.42 | +0.70 | +0.96% | 3, 084, 992 |
| LUV | 44.08 | +3.04 | +7.41% | 15, 263, 945 |
| MCD | 110.87 | +8.33 | +8.12% | 25, 235, 657 |
| MMI | 46.35 | +0.86 | +1.89% | 90, 869 |
| MMM | 156.00 | +6.18 | +4.12% | 5, 099, 544 |
| MNST | 142.47 | +3.58 | +2.58% | 1, 089, 709 |
| MRK | 52.01 | +1.45 | +2.81% | 18, 436, 707 |
| MU | 16.72 | +0.29 | +1.77% | 33, 980, 996 |
| NEM | 19.03 | +0.61 | +3.31% | 6, 150, 365 |
| NFLX | 97.32 | -0.64 | -0.65% | 12, 596, 979 |
| NKE | 132.41 | -0.06 | -0.05% | 4, 646, 391 |
| NOC | 179.50 | +5.37 | +3.08% | 1, 181, 378 |
| NVS | 92.43 | +0.84 | +0.92% | 1, 952, 796 |
| ODP | 7.41 | -0.02 | -0.27% | 8, 210, 222 |
| OI | 23.83 | +0.70 | +3.03% | 1, 095, 392 |
| PLAY | 36.87 | +0.56 | +1.54% | 447, 112 |
| QCOM | 60.43 | +1.46 | +2.48% | 10, 904, 404 |
| QSR | 37.00 | +0.22 | +0.60% | 1, 520, 514 |
| RTN | 117.28 | +4.62 | +4.10% | 3, 136, 045 |
| SBUX | 61.49 | +0.96 | +1.59% | 9, 180, 488 |
| SINA | 46.58 | +1.00 | +2.19% | 509, 724 |
| SIRI | 3.97 | +0.06 | +1.53% | 63, 917, 324 |
| SNE | 28.74 | +0.64 | +2.28% | 1, 439, 661 |
| SNY | 49.88 | +0.73 | +1.49% | 1, 104, 891 |
| SSYS | 30.87 | +1.55 | +5.29% | 1, 272, 244 |
| T | 33.96 | +0.36 | +1.07% | 33, 259, 223 |
| TGT | 77.11 | +0.71 | +0.93% | 4, 936, 696 |
| TM | 125.23 | +1.53 | +1.24% | 271, 188 |
| TMUS | 211.72 | +1.63 | +0.78% | 2, 820, 496 |
| TSO | 101.53 | +1.29 | +1.29% | 1, 751, 049 |
| TSS | 50.32 | +1.38 | +2.82% | 998, 756 |
| TUP | 61.27 | +1.46 | +2.44% | 936, 982 |
| UNP | 97.01 | +3.60 | +3.85% | 6, 934, 985 |
| V | 76.42 | +0.96 | +1.27% | 9, 003, 022 |
| VLO | 60.36 | +1.06 | +1.79% | 6, 128, 710 |
| VRSN | 75.41 | +0.95 | +1.28% | 900, 541 |
| VZ | 45.89 | +1.03 | +2.30% | 15, 348, 511 |
| YHOO | 31.67 | +0.55 | +1.77% | 18, 193, 560 |