The LEAPS Trader
105 W. Monument Street
Baltimore, MD 21201
Friday, January 12, 2007
Email – #353
** AMD Woes, and Mr. Softie Sets A New 52-Week High
Advanced Micro Devices (NYSE: AMD) just reported poor guidance for the coming quarter. It is facing significant price competition, and gains from the recent acquisition of ATI have not kicked in yet.
AMD is famous for delivering surprises, both negative and positive. While this news is definitely negative, we have a lot of time left on this play for AMD to deliver a positive surprise in the months ahead.
Our Microsoft (Nasdaq: MSFT) January 2008 $30 calls (WMF-AF) are up more than 50% (more than 100% for some of you who bought on our re-recommendation) as the shares have reached new 52-week highs.
The company’s new Vista operating system is getting ready to ramp up this year, its X-Box sales are cranking, and the new Zune is number 2, behind the I-POD. And the company keeps buying back shares with its multi-billion cash horde. Barring a market meltdown in tech shares, we have very strong potential with this position.
On another note, set a NEW mental stop-loss on your S&P 500 MITT (AMEX: MCP).
We have a couple of years left on this S&P call option which has allowed us to gain in lock step with the gains of the S&P 500 over the past two years. Set a sell-stop at $12.
Good trading,
Karim Rahemtulla
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Current Portfolio:
Company / Symbol: Pep Boys (NYSE: PBY)
Option / Symbol: Jan. 08 $10 call (KSY AB)
Date Purchased: 1/9/07
Current Price: $5.50
Comment: Hold.
Company / Symbol: Nasdaq 100 Index (Nasdaq: QQQQ)
Option / Symbol: Jan. 08 $40 put (WD MN)
Date Purchased: 11/27/06
Current Price: $1.20
Comment: Hold.
Company / Symbol: Nasdaq 100 Index (Nasdaq: QQQQ)
Option / Symbol: Jan. 08 $48 call (YWZ AV)
Date Purchased: 11/27/06
Current Price: $3.10
Comment: Hold.
Company / Symbol: Microsoft (Nasdaq: MSFT)
Option / Symbol: Jan. 08 $30 call (WMF AF)
Date Purchased: 8/8/05
Current Price: $3.80
Comment: Hold.
Company / Symbol: S&P 500 MITT (AMEX: MCP)
Date Purchased: 7/18/03
Current Price: $12.68
Comment: Hold. Set a new mental stop at $12.
Company / Symbol: Chesapeake Energy (NYSE: CHK)
Option / Symbol: Jan. 08 $35 call (WZY AG)
Date Purchased: 4/25/06
Current Price: $1.30
Comment: Hold.
Company / Symbol: Advance Micro Devices (NYSE: AMD)
Option / Symbol: January 2009 $35 call (VVV AG)
Date Purchased: 6/21/06
Current Price: $1.40
Comment: Hold.
Bull & Bear Spreads
Company / Symbol: Allstate (NYSE: ALL)
Option / Symbol: Jan. 08 $60 put (WLZ ML)
Date Purchased: 12/8/06
Current Price: $2.00
Comment: Hold
Company / Symbol: Allstate (NYSE: ALL)
Option / Symbol: Jan. 08 $55 put (WLZ MK)
Date Purchased: 12/8/06
Current Price: $0.95
Comment: Hold. Sold put against Jan. 08 $60 position.
Company / Symbol: CBOE Volatility Index (WCB: ^VIX)
Option / Symbol: Feb. 07 $15.00 call (VIX BC)
Date Purchased: 5/3/06
Current Price: $0.65
Comment: Hold
Company / Symbol: CBOE Volatility Index (WCB: ^VIX)
Option / Symbol: Feb. 07 $17.50 call (VIX BW)
Date Purchased: 6/14/06
Current Price: $0.40
Comment: Hold. Sold call against Feb. 07 $15 position.
Company / Symbol: GoldCorp (NYSE: GG)
Option / Symbol: Jan. 09 $30 call (OPJ AF)
Date Purchased: 6/9/06
Current Price: $5.50
Comment: Hold.
Company / Symbol: GoldCorp (NYSE: GG)
Option / Symbol: Jan. 09 $40 call (OPJ AH)
Date Purchased: 6/9/06
Current Price: $2.95
Comment: Hold. Sold call against January 09 $30 position.
Company / Symbol: Teva Pharmaceutical (Nasdaq: TEVA)
Option / Symbol: Jan. 08 $40 call (WTX AH)
Date Purchased: 5/23/06
Current Price: $1.15
Comment: Hold.
Company / Symbol: Teva Pharmaceutical (Nasdaq: TEVA)
Option / Symbol: Jan. 08 $45 call (WTX AI)
Date Purchased: 5/23/06
Current Price: $0.45
Comment: Hold. Sold call against January 08 $40 position.
Company / Symbol: Energy Select Sector SPDR (AMEX: XLE)
Option / Symbol: Jan. 07 $39 put (XLE MM)
Date Purchased: 3/1/05
Current Price: $0.10
Comment: Hold.
Company / Symbol: Energy Select Sector SPDR (AMEX: XLE)
Option / Symbol: Sell Jan. 07 $37 put (XLE MK)
Date Sold: 3/30/05
Current Price: $0.10
Comment: Hold. Sold put against January 07 $39 position.
