Thursday, February 19, 2015

Thursday's Finalists

Two of the four stocks under consideration as potential trades today -- SDY and DEI -- have failed confirmation in the first hour after the closing bell. (See "Thursday's Prospects" for the early rounds of screening.)

That leaves SONC and ZAYO on the board.

My goal at this point is to identify trades that provide both leverage and a hedge. That means a stock must have liquid options that I can use in constructing a position

SONC is an oddity, a relatively low-priced stock, trading at $32 plus change, with option strike prices standing $5 apart near the money. That means the bid price sinks to zero only one or two strikes out of the money. This isn't a grid that can be used to build option spreads.

ZAYO's grid is similar, and is even less liquid.

Given these choices, I don't intend to open any new positions based on Wednesday's markets.

-- Tim Bovee, Portland, Oregon, Feb. 19, 2015


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. My volatility trading rules can be read here.


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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.

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