Comments on: Using Volatility to Predict Future Stock Prices https://www.thebluecollarinvestor.com/using-volatility-to-predict-future-stock-prices/ Learn how to invest by selling stock options. Fri, 30 Oct 2015 15:26:08 +0000 hourly 1 By: Roni https://www.thebluecollarinvestor.com/using-volatility-to-predict-future-stock-prices/#comment-24710 Fri, 30 Oct 2015 15:26:08 +0000 http://www.thebluecollarinvestor.com/?p=12824#comment-24710 In reply to Jay.

Hi Jay,
I love the axiom you mentioned.
1% ROO in one week, is 52% annualized, and Activision is a solid bet.
My preferred options are the monthly options too, but in this case, the earnings report due Nov 3, rules them out.
So, if my shares are not called away today, I will sell them next monday or tuesday before the bell, with gain or loss.
To me the most important is low risk.

Have a nice weekend – Roni

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By: Roni https://www.thebluecollarinvestor.com/using-volatility-to-predict-future-stock-prices/#comment-24709 Fri, 30 Oct 2015 14:52:50 +0000 http://www.thebluecollarinvestor.com/?p=12824#comment-24709 In reply to Alan Ellman.

Yes Alan,
no matter how this trade turns out, I am always trying to do the right trade, and your tips are super welcome.
Thanks again – Roni

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By: Alan Ellman https://www.thebluecollarinvestor.com/using-volatility-to-predict-future-stock-prices/#comment-24708 Fri, 30 Oct 2015 11:32:15 +0000 http://www.thebluecollarinvestor.com/?p=12824#comment-24708 In reply to Benson.

Benson,

Generally yes but for full transparency there are rare times I will hold a stock through an ER and write the call after the report passes. I will do this for companies that historically give muted guidance and tend to beat consensus. My goal here is to benefit from a positive report and then write the call. AAPL and CSCO are examples of such securities I did this for many years ago. THIS IS NOT PART OF THE BCI METHODOLOGY because it is so difficult to quantify and is based on “gut and experience” and I want all aspects of the BCI methodology to be as scientific as possible.

Alan

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By: Benson https://www.thebluecollarinvestor.com/using-volatility-to-predict-future-stock-prices/#comment-24707 Fri, 30 Oct 2015 11:24:21 +0000 http://www.thebluecollarinvestor.com/?p=12824#comment-24707 In reply to Alan Ellman.

Alan,

I just noticed AGN earning report date this morning when I checked Yahoo although most of the companies with NA. Thank you for the warning.

If you avoid the option for earning report, you avoid the security as well in the IRA account?

Have a great weekend!

Benson

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By: Alan Ellman https://www.thebluecollarinvestor.com/using-volatility-to-predict-future-stock-prices/#comment-24706 Fri, 30 Oct 2015 10:54:15 +0000 http://www.thebluecollarinvestor.com/?p=12824#comment-24706 In reply to Benson.

Benson,

Glad I sparked an interest in pursuing this strategy.

Respectfully, I would ask you to check the news of this highly-sensitive news-driven security as well as the upcoming November 3rd earnings report. One of the key rules in the BCI methodology is never to sell a call if the company has an upcoming earnings report prior to contract expiration…too risky. If you agree, the call can be bought back prior to November 3rd, hopefully at a profit.

Alan

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By: Benson https://www.thebluecollarinvestor.com/using-volatility-to-predict-future-stock-prices/#comment-24705 Fri, 30 Oct 2015 05:09:35 +0000 http://www.thebluecollarinvestor.com/?p=12824#comment-24705 Alan,

Finished reading your book and did 1st call.
One Nov AGN@310 $9.80
My next step is Buy to cover @ $1.90 I remember of the 20% rule.

Benson

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By: Alan Ellman https://www.thebluecollarinvestor.com/using-volatility-to-predict-future-stock-prices/#comment-24703 Thu, 29 Oct 2015 22:55:56 +0000 http://www.thebluecollarinvestor.com/?p=12824#comment-24703 In reply to Nate.

Nate,

You’re right. When I responded I was focused on the increment aspect. So the way the question was framed has an inherent error with the stats. Perhaps he mistakenly set a market order. I suspect that Fred did mean $3.10 as the second limit order…hopefully we’ll hear back from Fred.

Alan

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