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