Tim Bovee, Private Trader: Tuesday's Finalist: RYL

Tuesday, September 23, 2014

Tuesday's Finalist: RYL

A potential bear play, the California-based homebuilder and mortgage finance company The Ryland Group (RYL), has made past earlier analysis and into the finals.

Of the nine who survived the early analysis, two failed confirmation: FSLR and HP. (See "Tuesday's Prospects.")

Five had options with spreads that are too wide or open interest that is too low for use in constructing a bear position: QLIK, POST, RICE, DNOW and USG.

One has a bullish rating from Zacks Investment Research, the service I use to short-cut analysis of the fundamentals, contrary to the bear signal it gave on Monday: LGF.

RYL carries a neutral ratings from Zacks and a bearish chart; last week it began the sharp decline that produced the bear signal on Monday.

Also important, its options are liquid, providing opportunities for leverage and hedging. The front-month at-the-money bid/ask spread on puts is 8%.

I shall post an analysis of RYL as a potential bear play prior to the closing bell today.

The one symbol on my supplement list of potential bull plays on innovative companies, CL, failed confirmation.

-- Tim Bovee, Portland, Oregon, Sept. 23, 2014

References

My shorter-term trading rules can be read here. My longer-term trading rules can be read here. And the classic Turtle Trading rules on which my rules are based can be read here.

Disclaimer

Tim Bovee, Private Trader tracks the analysis and trades of a private trader for his own accounts. Nothing in this blog constitutes a recommendation to buy or sell stocks, options or any other financial instrument. The only purpose of this blog is to provide education and entertainment.

No trader is ever 100 percent successful in his or her trades. Trading in the stock and option markets is risky and uncertain. Each trader must make trading decisions for his or her own account, and take responsibility for the consequences.