Papale on Standard Deviation

My favorite show on TV is “Gold Rush”.  If you haven’t seen it, it follows 3 gold mining crews as they mine for gold, mostly in Alaska.  I really like this 18 year old kid named Parker, who loves his grandfather and is determined to do whatever it takes to find the gold.  He faces ups and downs, hope and despair and one issue to deal with after another.  Kinda reminds me of how it was with my butterfly last month.

Many options strategies are set based on an expected magnitude move in the underlying.  If you are a butterfly or condor trader you know that it is not really the direction of the move but how much it moves.  Probably the most common measure to estimate the magnitude of an expected move is standard deviation.  Standard deviation is a statistical measure of movement either up or down based on a volatility input, number of days and an underlying price.  We then can get a probability estimate of a price range of an underlying over a time horizon.

When we speak of one standard deviation we mean that there is a 68% expectation that the price of the underlying will stay within the range estimate over the time we specify.  Two standard deviation shows with a 95% expectation  the price range of the underlying for a given time period.  We can then use these probabilities to determine where and how to place our trades.  Strikes in the second standard deviation are less likely to be hit than strikes in the first standard deviation.  So by using statistical expectations, specifically standard deviation, a trader can use historical price behavior to help predict future price expectation.

The Prepared Mind: February 23, 2014

“Chance favors the prepared mind.” — Louis Pasteur

Most major indexes showed slight losses for the holiday shortened trading.  The small cap laden Russell 2000(RUT) ignored this trend by gaining 1.32%.  This is a continuation of a minor disconnect between the S&P 500 (SPX) and the RUT.   I first noticed this about a month ago.  The two indexes generally trade in lockstep.  Daily movement and percentage gains or losses in one index are usually mirrored in the other.  The difference between the two is generally miniscule.   This has not held true as of late.  The why is not readily apparent.   The implications, if any, upon trading and individual trading strategies are unclear.  It could be something as trivial as a minor change in the daily trading rotation of different investing sectors.  The bottom line is that all the major indexes showed week-to-week minimal change.  Technical analysts are pointing to the 1850 level for the SPX as major resistance.  Any move above 1850 is regarded by many analysts as an indicator the correction in the S&P 500 is over.  Others believe we are locked in a trading range which will be characterized by intraday and interday volatility.

Trading interest and activity remains high in the VIX.  The spot VIX and the spot for the other volatility indexes showed modest gains for the week. These gains were reflected in the March futures on the VIX and RVX.  The futures for April and beyond held constant or showed losses of less than 1%.  The backwardization between the spot VIX and the monthly VIX futures has disappeared.  Per Russell Rhoads at the CBOE, one of the larger trades of the week was a buyer of VIX  March 17 Calls  who sold twice as many Mar 22 Calls to create a ration spread.  This spread is designed to take advantage of a moderate spike in volatility.  This is not a trading recommendation

Here is a capsule view of last week’s market numbers:

Index

Close

Weekly Change

% Weekly

% YTD

Volatility of  Index

Dow Jones Industrials (DJIA)

16,103.30

-51.09

-0.32%

-3.61%

14.20% (VXD)

S&P 500 (SPX)

1,836.25

-2.38

-0.13%

-0.85%

14.68% (VIX)

NASDAQ 100 (NDX)

3,662.60

-1.28

-0.03%

2.65%

15.81% (VXN)

Russell 2000 (RUT)

1,163.16

15.19

1.32%

-0.05%

19.20% (RVX)

S&P 100 (OEX)

807.33

-5.24

-0.64%

-2.55%

12.85% (VXO)

CBOE Volatility Index (VIX)

14.68

1.11

8.18%

NA

 

 

Manufacturing and housing are the major focus of economic reports this week.  The revised 4th Quarter estimate for the US GDP will be released on Friday.  This number, in conjunction with consumer sentiment, will have the ability to move the market.  The wild card for the week will be speeches by representative of the Fed.  The governors have a heavy speaking load this week.  I have posted their schedule and respective topics in the calendar which follows.  The highlight of the week will be Fed Chair Janet Yellen’s Thursday testimony before the Senate Banking Committee.

Fourth Quarter earnings announcements are slowing to a trickle with the major announcements coming from the retail sector.  Major announcements include: Home Depot, Macys, Dollar Tree, Lowe’s, L. Brands, Chesapeake Energy, Target, Ross Stores, Monster Beverage, Kohl’s, The Gap, Best Buy and salesforce.com.   Keep an eye on bellwether and “hot’ stocks.  I scan stocks announcing earnings the coming week using the following criteria:  Price > 20, 30 Day Implied Volatility > 20, and Average Daily Option Volume > 200 contracts.  It is your responsibility to confirm these earnings dates. Earnings dates can and do change.

 

Trading advice to remember:

  “Chance favors the Prepared Mind.” – Louis Pasteur

“All humans are alike and all humans are equal.

 It is just the perception of the eye that sees any different.” – Anonymous

Monday February 24:  

Economic:  Chicago Fed National Activity Index – 8:30, PMI Services Flash – 8:58, Dallas Fed Manufacturing Survey – 10:30

International Economic:  No major announcements.

Other:  FDIC Vice Chair Thomas Hoenig speech financial architecture and growth to NABE in Arlington, Virginia – 3:50 PM.

Optionable Earnings: 

Symbol

Company Name

Feb 21 Close

IV30

B/A

XEPS

PANW Palo Alto Networks Inc

$73.14

72.4

B

($0.03)

CHMT Chemtura Corp

$24.62

38.4

A

$0.11

LYV Live Nation Entertainment, Inc.

$21.99

35.1

A

($0.37)

OKE ONEOK, Inc.

$60.98

22.0

A

$0.60

OKS Oneok Partners LP

$55.52

22.5

A

$0.67

PPO Polypore International, Inc.

$30.01

57.8

A

$0.23

SCTY SolarCity Corp

$75.52

82.2

A

($0.56)

SGY Stone Energy Corporation

$35.55

50.0

A

$0.65

SINA SINA Corp

$73.88

57.1

A

$0.34

THC Tenet Healthcare Corp

$46.12

38.5

A

$0.34

TXRH Texas Roadhouse Inc

$26.35

37.1

A

$0.23

WMGI Wright Medical Group Inc

$32.01

36.3

A

($0.18)

XPO XPO Logistics Inc

$27.18

47.3

A

($0.31)

 

Tuesday February 25:

Economic:  ICSC-Goldman Store Sales – 7:45, Redbook – 8:55, FHFA House Price Index – 9:00, S&P Case-Shiller HPI – 9:00, Consumer Confidence -  10:00, Richmond Fed Manufacturing Index – 10:00 – 10:00, State Street Investor Confidence – 10:00.

Other: Federal Reserve Gov. Daniel Tarullo speech to NABE in Arlington, Virginia – 10:10.

International Economic:  Germany GDP – 2:00 AM.

Optionable Earnings: 

Symbol

Company Name

Feb 21 Close

IV30

B/A

XEPS

CBRL Cracker Barrel Old Country Store

$97.93

32.1

B

$1.55

CRZO Carrizo Oil & Gas, Inc.

$44.90

41.3

B

$0.41

DPZ Domino’s Pizza, Inc.

$72.26

33.6

B

$0.76

EOG EOG Resources Inc

$180.03

31.2

B

$1.96

EXH Exterran Holdings, Inc.

$36.05

36.8

B

$0.26

EXPD Expeditors International

$41.70

27.0

B

$0.47

FNP Fifth & Pacific Companies Inc

$30.79

46.6

B

$0.29

GTLS Chart Industries, Inc.

$89.83

45.0

B

$0.82

HFC HollyFrontier Corp

$45.66

31.9

B

$0.20

M Macy’s, Inc.

$53.46

27.2

B

$2.17

OGE OGE Energy Corp.

$36.17

26.5

B

$0.24

PCRX Pacira Pharmaceuticals Inc

$71.88

57.2

B

($0.31)

RLGY Realogy Holdings Corp

$45.40

38.2

B

$0.26

SDRL Seadrill Ltd

$36.44

29.2

B

$0.78

TMUS T-Mobile Us Inc

$31.57

50.0

B

($0.15)

TOL Toll Brothers Inc

$37.38

34.0

B

$0.18

UTHR United Therapeutics Corporation

$105.63

42.9

B

$1.69

VC Visteon Corp

$83.81

27.8

B

$1.46

VSI Vitamin Shoppe Inc

$41.83

64.4

B

$0.37

AVGO Avago Technologies Ltd

$59.00

37.2

A

$0.70

CBI Chicago Bridge & Iron Company

$79.86

29.7

A

$1.17

DWA Dreamworks Animation Skg Inc

$32.83

45.3

A

$0.34

FSLR First Solar, Inc.

$56.88

70.4

A

$1.00

JAZZ Jazz Pharmaceuticals PLC

$170.29

49.6

A

$1.64

NFX Newfield Exploration Co.

$25.22

47.2

A

$0.46

OAS Oasis Petroleum Inc.

$42.85

42.7

A

$0.64

QCOR Questcor Pharmaceuticals Inc

$77.84

81.3

A

$1.65

QEP QEP Resources Inc

$31.88

33.7

A

$0.42

RGR Sturm, Ruger & Company

$70.00

43.5

A

$1.33

RRC Range Resources Corp.

$87.52

33.1

A

$0.26

SBAC SBA Communications Corporation

$99.21

23.6

A

($0.09)

SPN Superior Energy Services, Inc.

$27.80

32.6

A

$0.31

 

 

Wednesday February 26:

Economic:  MBA Purchase Applications – 7:00, New Home Sales – 10:00, EIA Petroleum Status Report –10:30.

International Economic:  Great Britain GDP – 4:30.

Other:  Boston Federal Reserve Bank President Eric Rosengren speech on the economic outlook in Boston – 12:00, Cleveland Federal Reserve Bank President Sandra Pianalto speech on the history of the Fed, in Wooster, Ohio – 7:30 PM.

Optionable Earnings:

Symbol

Company Name

Feb 21 Close

IV30

B/A

XEPS

AEGR Aegerion Pharmaceuticals, Inc.

$65.39

64.8

B

($0.28)

ANF Abercrombie & Fitch Co.

$34.59

55.6

B

$1.04

BUD Anheuser Busch Inbev SA (ADR)

$101.33

20.7

B

$1.29

CHK Chesapeake Energy Corporation

$26.65

33.6

B

$0.40

CLH Clean Harbors Inc

$53.94

37.3

B

$0.56

CNP CenterPoint Energy, Inc.

$24.28

30.1

B

$0.27

CRI Carter’s, Inc.

$66.83

35.0

B

$1.02

DGI DigitalGlobe Inc

$40.88

35.3

B

$0.07

DLTR Dollar Tree, Inc.

$51.52

25.0

B

$1.05

GLNG Golar LNG Limited (USA)

$34.26

42.3

B

$0.58

LOW Lowe’s Companies, Inc.

$46.66

26.5

B

$0.31

NXST Nexstar Broadcasting Group, Inc.

$44.86

48.8

B

$0.38

SODA Sodastream International Ltd

$41.67

80.2

B

$0.01

TGT Target Corporation

$56.62

24.3

B

$0.85

ADSK Autodesk, Inc.

$54.90

39.3

A

$0.21

AGO Assured Guaranty Ltd.

$23.00

42.4

A

$0.66

AR Antero Resources Corp

$57.64

34.4

A

$0.26

BIDU Baidu Inc (ADR)

$173.90

48.1

A

$1.42

BLOX Infoblox Inc

$21.31

85.4

A

($0.06)

CLR Continental Resources, Inc.

$118.70

36.9

A

$1.31

GPOR Gulfport Energy Corporation

$64.65

55.3

A

$0.18

LB L Brands Inc

$53.31

27.5

A

$1.61

MWE Markwest Energy Partners LP

$70.69

22.7

A

$0.22

NDLS Noodles & Co

$35.63

53.7

A

$0.12

RIG Transocean LTD

$42.98

25.5

A

$0.82

TROX Tronox Ltd

$22.69

39.6

A

($0.31)

WDAY Workday Inc

$98.20

51.1

A

($0.26)

WLL Whiting Petroleum Corp

$62.60

33.6

A

$0.89

 

Thursday February 27:

Economic:  Durable Goods Orders – 8:30, Jobless Claims – 8:30,  Bloomberg Consumer Comfort Index – 9:45,  EIA Natural Gas Report – 10:30, Kansas City Fed Manufacturing Index – 11:00.

Other:  Federal Reserve Chair Janet Yellen to testify before the Senate Banking Committee in Washington DC -10:00, Atlanta Fed President Dennis Lockhart and Kansas City Fed President Esther George speak at Atlanta Fed’s annual banking conference – 3:15.

International Economic:   EMU Economic Sentiment – 5:00 AM, Japan Industrial Production – 6:50 PM..

Optionable Earnings: 

Symbol

Company Name

Feb 21 Close

IV30

B/A

XEPS

ACIW ACI Worldwide Inc

$59.57

45.8

B

$4.52

ALKS Alkermes Plc

$52.96

48.9

B

($0.08)

BBY Best Buy Co., Inc.

$24.84

56.5

B

$1.01

CTRX Catamaran Corp (USA)

$51.70

34.1

B

$0.55

HLT Hilton Worldwide Holdings Inc

$21.49

31.4

B

$0.18

KSS Kohl’s Corporation

$51.87

31.0

B

$1.53

LAMR Lamar Advertising Co

$50.15

51.4

B

$0.15

LKQ LKQ Corporation

$29.09

41.1

B

$0.28

LNCO LinnCo LLC

$31.34

28.6

B

$0.41

LPI Laredo Petroleum Inc

$27.74

49.6

B

$0.09

MYL Mylan Inc

$52.26

38.7

B

$0.75

NSM Nationstar Mortgage Holdings Inc

$28.23

68.2

B

($0.02)

NTI Northern Tier Energy LP

$24.20

31.1

B

$0.45

OCN Ocwen Financial Corp

$35.64

69.3

B

$0.87

RDC Rowan Companies PLC

$32.30

25.6

B

$0.42

SRPT Sarepta Therapeutics Inc

$27.56

133.5

B

($0.70)

VRX Valeant Pharmaceuticals Intl Inc

$148.00

45.8

B

$2.06

WNR Western Refining, Inc.

$38.47

37.8

B

$0.58

YRCW YRC Worldwide Inc

$20.92

81.6

B

($2.27)

ACAD ACADIA Pharmaceuticals Inc.

$24.58

90.2

A

($0.13)

ARP Atlas Resource Partners, L.P.

$20.86

28.1

A

($0.03)

ATLS Atlas Energy LP

$41.83

39.0

A

$0.40

BCEI Bonanza Creek Energy Inc

$45.71

45.4

A

$0.61

BID Sothebys

$47.30

36.3

A

$1.46

CLVS Clovis Oncology Inc

$73.13

66.9

A

($0.76)

CRM salesforce.com, inc.

$63.01

44.3

A

($0.08)

DECK Deckers Outdoor Corp

$85.56

65.7

A

$3.80

GPS The Gap Inc.

$42.34

30.4

A

$0.66

MDVN Medivation Inc

$84.64

46.0

A

($0.11)

MNST Monster Beverage Corp

$74.70

40.1

A

$0.45

OLED Universal Display Corporation

$33.72

74.0

A

$0.37

PODD Insulet Corporation

$45.50

42.6

A

($0.09)

QUNR Qunar Cayman Islands Ltd

$32.02

79.4

A

($0.04)

ROST Ross Stores, Inc.

$67.65

26.6

A

$1.02

SFM Sprouts Farmers Market Inc

$35.98

61.3

A

$0.06

SLXP Salix Pharmaceuticals, Ltd.

$103.69

46.4

A

$0.64

SPLK Splunk Inc

$88.51

66.9

A

($0.07)

 

Friday February 28:

Economic:  GDP – 8:30, Chicago PMI – 9:45, Uinversity of Michigan Consumer Sentiment – 9:55, Pending Homes Sales Index – 10:00.

Other:  Federal Reserve Gov. Jeremy Stein and Minneapolis Fed President Narayana Kocherlakota on panel discussing monetary policy and financial stability, in New York – 10:15, Chicago Fed President Charles Evans and Philadelphia Fed President Charles Plosser on panel discussing communications and unconventional monetary policy in New York – 1:30.

International Economic: No major announcements.

.

Optionable Earnings: 

Symbol

Company Name

Feb 21 Close

IV30

B/A

XEPS

BSFT BroadSoft Inc

$30.09

72.4

B

$0.05

DDD 3D Systems Corporation

$80.56

60.6

B

$0.22

HMSY HMS Holdings Corp.

$20.62

58.9

B

$0.23

IRM Iron Mountain Incorporated

$28.30

62.6

B

$0.22

NRG NRG Energy Inc

$28.72

28.4

B

$0.23

 

Monday March 3:

Economic:  Motor Vehicle Sales, Gallup US Consumer Spending Measure – 8:30, PMI Manufacturing Index – 8:58, ISM Manufacturing Index – 10:00, Construction Spending – 10:00, Global Manufacturing PMI – 11:00. 

International Economic:  EMU PMI Manufacturing – 4:00 AM.

Optionable Earnings:  

Symbol

Company Name

Feb 21 Close

IV30

B/A

XEPS

AKRX Akorn, Inc.

$25.73

45.8

B

$0.13

BMRN BioMarin Pharmaceutical Inc.

$80.13

43.3

B

($0.34)

CLDX Celldex Therapeutics, Inc.

$28.76

81.0

B

($0.28)

JKS JinkoSolar Holding Co., Ltd.

$30.96

90.3

B

$0.86

MGA Magna International Inc. (USA)

$86.56

24.6

B

$1.52

ROC Rockwood Holdings, Inc.

$73.82

32.6

B

$0.31

SSYS Stratasys Ltd

$127.11

51.6

B

$0.41

GEVA Synageva Biopharma Corp

$108.86

60.0

A

($1.03)

MR Mindray Medical International Ltd

$35.91

62.4

A

$0.50

URS URS Corp

$45.65

36.1

A

$0.19

Papale on Market Makers

I must admit it – curling has me intrigued.  The athletes look like men and women from the neighborhood who could just as easily been fishing or bowling.  I guess it’s the great north version of shuffleboard.  Not exactly sure what the brooms do but when they sweepers start going at it they sweep some mean ice.  Finals coming up.  I’ll be watching.  Unless there’s a good episode of bass pro fishing.

Option prices, like stocks, are driven by supply and demand.  The market maker, the person in charge of providing tradable prices and liquidity, essentially is responding to economic forces when posting markets for options.

For example, if a call has a market of 2 – 2.5 that means he is willing to buy it at 2 and sell at 2.5.  The difference, we know as slippage, is his spread or profit.  If I come in a pay 2.5 he is now short the calls at 2.5.  His new market might be 2.25 – 2.75.  The market adjusts based on the higher demand for calls.  You can see here while the market maker is setting the price, the force behind where he sets it is based on supply and demand forces in the option market.  As more buyers  come in, prices will continue to go up in most cases.  More sellers have the opposite effect, driving prices down.  This ebb and flow of supply and demand of options is measure in the VIX as well.  While the market maker is responsible to post markets, for the most part, he is only responding to orders that come in to trade.  It is the collective marketplace that really is driving option prices.

The Prepared Mind: February 18, 2014

I am not sure which are schizophrenic – the markets or the analysts following the markets.  The songs market participants have been singing over  the past three weeks of market action keep changing.  Three weeks ago everyone was singing the refrain to Freddy King’s  “Going Down” –“I’m goin’ down, down, down, down, down, down.” The next week a new song was added to the playlist.  The markets were harmonizing and  “going down” with Freddy and everyone started sing with the Man in Black –  Johnny Cash:

I fell into a burning ring of fire
I went down, down, down and the flames went higher

Euphoria has returned.  The bull market has returned and the market pundits are instructing  us to “Put on a Happy Face.”

Pick out a pleasant outlook
Stick out that noble chin
Wipe off that full of doubt look
Snap on a happy grin

We are vacillating between the environment where bad news is good news and good news is bad news.  Throw in a little bad news is bad news and you have described the current approach of financial newsmakers to the markets.  The major indexes were up 2% – 3% despite less than stellar economic news. Retail sales and industrial production were down.  Thursday’s job numbers were disappointing.  Bad weather was the universal excuse applied to any less than positive numbers.  The excuse rings hollow. Bad weather is the only constant we have had during the past three weeks for market gyrations.

VIX futures and options continued to trade at elevated volumes.  The backwardization of the futures to the spot disappeared in March and April expirations.  This absence of backwardization (the spot trading higher than the futures) and the decrease in of over 11% the spot volatility for all the indexes indicates an easing of the fear of a further sell-off.  The CBOE Short-Term Volatility Index (VXST) futures trading started this past Thursday.  The VXST sold-off entering the three day weekend.  The CBOE announced that in the 3rd Quarter of 2014, they intend to introduce Extended Trading Hours (ETH) for options on the S&P 500 Index complex (SPX, SPXW, SPXQ, SPXPM) and on the CBOE S&P 500 Volatility Index (VIX), contingent upon completion of systems enhancements and Securities and Exchange Commission (SEC) approval of requisite rules.

Here is a capsule view of last week’s market numbers:

Index

Close

Weekly Change

% Weekly

% YTD

Volatility of  Index

Dow Jones Industrials (DJIA)

16,154.39

360.31

2.28%

-3.22%

13.15% (VXD)

S&P 500 (SPX)

1,838.63

41.61

2.32%

-0.68%

13.57% (VIX)

NASDAQ 100 (NDX)

3,663.88

101.97

2.86%

2.70%

14.80% (VXN)

Russell 2000 (RUT)

1,147.97

33.24

2.98%

-1.84%

18.34% (RVX)

S&P 100 (OEX)

812.57

17.28

2.17%

-1.74%

12.13% (VXO)

CBOE Volatility Index (VIX)

13.57

-1.72

-11.25%

NA

 

 

This week’s economic reports will emphasize housing and inflation.  Analysts are expecting negative housing numbers due to the nationwide cold snap. This is the last week of announcements for Q4 earnings.    Major announcements include: Coca-Cola, Herbalife, Waste Management, Marriott, Peugeot, Tesla, Groupon, Hewlett-Packard, Nordstrom, Priceline.com, Wal-Mart and Charter Communications.   The earnings trades will be particularly actin in Priceline.com (PCLN) and Tesla (TSLA.)      Keep an eye on bellwether and “hot’ stocks.  I scan stocks announcing earnings the coming week using the following criteria:  Price > 20, 30 Day Implied Volatility > 20, and Average Daily Option Volume > 200 contracts.  It is your responsibility to confirm these earnings dates. Earnings dates can and do change.

 

Trading advice to remember:

  “Chance favors the Prepared Mind.” – Louis Pasteur

“All humans are alike and all humans are equal.

 It is just the perception of the eye that sees any different.” – Anonymous

Monday February 17:  

US Holiday – President’s Day – All US Markets Closed

International Economic:  Bank of Japan Announcement.

Optionable Earnings:  None meeting criteria.

Tuesday February 18:

Economic:  Empire State Manufacturing Survey – 8:30, Treasury International Capital – 9:00, Housing Market Index – 10:00, E-Commerce Retail Sales – 10:00.

International Economic: Great Britain CPI and PPI – 4:30 AM, Japan All Industry Index – 11:30 PM.

Optionable Earnings: 

Symbol

Company Name

Feb 14 Close

IV30

B/A

XEPS

ADI Analog Devices, Inc.

$50.69

22.0

A

$0.48

AXLL Axiall Corp

$41.04

39.6

A

$0.68

CF CF Industries Holdings, Inc.

$231.23

28.2

A

$4.46

CYH Community Health Systems

$41.49

36.5

A

$0.69

FLR Fluor Corporation (NEW)

$78.87

26.6

A

$0.98

HLF Herbalife Ltd.

$66.90

70.3

A

$1.28

NPSP NPS Pharmaceuticals, Inc.

$38.30

58.1

A

$0.02

OII Oceaneering International

$71.31

29.9

A

$0.84

PNRA Panera Bread Co

$177.88

34.0

A

$1.95

PBPB Potbelly Corp

$22.70

63.6

A

$0.05

SM SM Energy Co.

$86.75

37.6

A

$1.43

TEX Terex Corporation

$43.80

39.1

A

$0.49

 

Wednesday February 19:

Economic:  MBA Purchase Applications – 7:00, ICSC-Goldman Store Sales – 7:45, Housing Starts – *:30, Producer Price Index – 8:30, Redbook – 8:55, FOMC Minutes 2:00.

International Economic:  Bank of England Minutes – 4:30 AM, China PMI Flash Manufacturing Index – 8:45 PM.

Other:  St. Louis Federal Reserve Bank President James Bullard speech on the economic outlook and monetary policy in Washington – 1:00.

Optionable Earnings:

Symbol

Company Name

Feb 14 Close

IV30

B/A

XEPS

CLMT Calumet Specialty Products Partners

$27.74

31.3

B

$0.09

XEC Cimarex Energy Co

$110.00

38.3

B

$1.41

CLH Clean Harbors Inc

$54.96

32.2

B

$0.56

DVN Devon Energy Corp

$62.27

24.8

B

$1.09

GRMN Garmin Ltd.

$46.26

31.3

B

$0.61

LL Lumber Liquidators Holdings Inc

$96.07

48.6

B

$0.72

MGM MGM Resorts International

$25.58

36.4

B

$0.00

OCR Omnicare, Inc.

$64.27

25.2

B

$0.90

SAVE Spirit Airlines Incorporated

$46.70

40.9

B

$0.50

CG The Carlyle Group LP

$35.17

30.7

B

$0.91

MDCO The Medicines Company

$29.28

47.0

B

$0.14

ARII American Railcar Industries, Inc.

$49.72

39.8

A

$0.99

ARRS Arris Group Inc

$27.88

50.9

A

$0.42

CAR Avis Budget Group Inc.

$38.67

40.4

A

$0.12

CXO Concho Resources Inc.

$110.69

33.4

A

$0.96

ETE Energy Transfer Equity, L.P.

$44.04

26.9

A

$0.27

EQIX Equinix Inc

$191.85

32.5

A

$0.78

AWAY HomeAway, Inc.

$41.91

52.0

A

$0.07

LOCK Lifelock Inc

$22.62

56.7

A

$0.16

MIC Macquarie Infrastructure Company

$58.06

27.0

A

$0.33

MAR Marriott International Inc

$50.11

21.7

A

$0.50

OIS Oil States International, Inc.

$98.57

26.5

A

$1.49

RGP Regency Energy Partners LP

$26.85

23.3

A

$0.10

SWY Safeway Inc.

$33.06

40.6

A

$0.47

SXL Sunoco Logistics Partners L.P.

$82.04

21.6

A

$0.71

TSRO TESARO Inc

$31.55

72.6

A

-$0.85

TSLA Tesla Motors Inc

$199.63

67.9

A

$0.04

TRN Trinity Industries Inc

$60.15

35.7

A

$1.41

VECO Veeco Instruments Inc.

$40.73

41.5

A

-$0.37

WMB Williams Companies, Inc.

$40.85

27.4

A

$0.21

 

Thursday February 20:

Economic:  Consumer Price Index – 8:30, Jobless Claims – 8:30,   PMI Manufacturing Flash – 8:58, Bloomberg Consumer Comfort Index – 9:45, Philadelphia Fed Survey – 10:00, Leading Indicators – 10:00, EIA Natural Gas Report – 10:30, EIA Petroleum Status Report –11:30.

International Economic:  German PPI – 2:00 AM, EU PMI Composite – 5:00 Am.

Optionable Earnings: 

Symbol

Company Name

Feb 14 Close

IV30

B/A

XEPS

ACT Actavis PLC

$191.63

31.5

B

$3.06

AER AerCap Holdings N.V.

$38.90

35.8

B

$0.65

CVI CVR Energy, Inc.

$37.36

38.8

B

$0.28

CVRR CVR Refining LP

$20.75

36.7

B

$0.36

CYBX Cyberonics, Inc.

$72.44

33.6

B

$0.49

DTV DIRECTV

$71.97

23.2

B

$1.28

FCN FTI Consulting, Inc.

$36.83

42.3

B

$0.41

IMAX IMAX Corporation (USA)

$26.11

41.3

B

$0.30

IDCC InterDigital, Inc.

$28.58

42.0

B

$0.30

PWR Quanta Services Inc

$31.77

29.8

B

$0.41

TK Teekay Corporation

$54.35

25.1

B

-$0.02

UPL Ultra Petroleum Corp.

$23.79

42.7

B

$0.37

WWE World Wrestling Entertainment, Inc.

$22.90

70.1

B

-$0.03

AGU Agrium Inc. (USA)

$88.22

23.2

A

$0.88

BBG Bill Barrett Corporation

$24.27

48.4

A

-$0.04

BCOR Blucora Inc

$23.54

59.0

A

$0.32

COG Cabot Oil & Gas Corporation

$38.83

37.6

A

$0.17

DXCM DexCom, Inc.

$42.56

57.4

A

-$0.07

ESRX Express Scripts Holding Co

$76.60

24.9

A

$1.12

HPQ Hewlett-Packard Company

$29.83

37.8

A

$0.85

INTU Intuit Inc.

$70.72

22.5

A

$0.04

MHK Mohawk Industries, Inc.

$145.68

32.4

A

$1.74

NEM Newmont Mining Corp

$23.53

36.9

A

$0.42

JWN Nordstrom, Inc.

$58.56

24.0

A

$1.33

PCLN Priceline.com Inc

$1,276.07

34.0

A

$7.66

QLIK Qlik Technologies Inc

$28.11

65.0

A

$0.23

FUEL Rocket Fuel Inc

$49.52

83.8

A

-$0.09

TS Tenaris S.A. (ADR)

$46.50

32.9

A

$0.69

WBMD WebMD Health Corp.

$46.51

49.3

A

$0.23

Friday February 21:

Economic:  Existing Home Sales – 10:00.

International Economic: EMU GDP Flash – 5:00 AM, EMU Merchandise Trade – 5:00 AM.

Optionable Earnings: 

Symbol

Company Name

Feb 14 Close

IV30

B/A

XEPS

CHTR Charter Communications, Inc.

$128.91

29.0

B

$0.21

DISH DISH Network Corp

$58.32

35.2

B

$0.40

 

Monday February 24:

Economic:  Chicago Fed National Activity Index – 8:30, PMI Services Flash – 8:58, Dallas Fed Manufacturing Survey – 10:30

International Economic:  No major announcements.

Optionable Earnings:  

Symbol

Company Name

Feb 14 Close

IV30

B/A

XEPS

PANW Palo Alto Networks Inc

$72.47

63.6

B

-$0.03

CHMT Chemtura Corp

$25.16

37.3

A

$0.11

FANG Diamondback Energy Inc

$58.89

45.8

A

$0.43

LYV Live Nation Entertainment, Inc.

$21.74

33.6

A

-$0.37

OKS Oneok Partners LP

$55.94

21.2

A

$0.67

OKE ONEOK, Inc.

$60.05

22.7

A

$0.60

PPO Polypore International, Inc.

$32.72

51.1

A

$0.23

SCTY SolarCity Corp

$75.87

83.8

A

-$0.56

SGY Stone Energy Corporation

$34.61

52.1

A

$0.67

THC Tenet Healthcare Corp

$47.00

37.5

A

$0.34

TXRH Texas Roadhouse Inc

$25.35

32.8

A

$0.23

 

 

 

 

 

Papale on Covered Calls and Dividends

There are two sporting events I love.  Not just because I am a fan of the sports themselves but also because for these events I am able to check them all day and night.  At work and at home it seems TV’s are on in the background and tuned in.  For that reason I love the Olympics and March Madness.  Happy Valentine’s Day.

If you sell covered calls you are probably aware that you are at risk at having your calls called away at any time.  In reality, it is quite predictable to determine when rational exercise will occur.  For American options, which are options that can be exercised at any time and include stock options, there are two times we can expect our short calls to get assigned.  First and obviously at expiration any call that is in the money will get exercised.  We are prepared for this and can manage our position accordingly.

The second and only time calls are exercised early is when a dividend is paid.  Call holders cannot receive dividends.  So on the day before the stock goes ex dividend, a call holder may determine it makes economic sense to exercise and take delivery of the stock for the dividend.  This is based on the size of the dividend.  The rule of thumb is if the dividend is greater than the remaining extrinsic value in the call, than the holder will exercise.  Remember, by exercising the option, the holder gives up all the extrinsic value left in the option.  So the size of the dividend has to make it worthwhile.  Keep track of ex dividend dates and buy your short calls back ahead of time if exercise is likely and you don’t want to lose your stock.

The Prepared Mind: February 10, 2014

“Chance favors the prepared mind.” –Louis Pasteur

On the surface it seems like it was a ho-hum week.  The indexes closed the week plus/minus 1% from the previous week’s close.  This is a situation where the picture from 50,000 feet up doesn’t tell the whole story.  The story was in the trading range for the week.  The SPX ranged from a low of 1,738 to a high of 1,798.  The NDX ranged from 3,419 to 3,563 and the Russell 2000 ranged from 1,082 to 1,130 It was a battle royale between bulls and bears.   It was a busy week for talking heads.  The message was constant and  contradictory.  The message ranged from “we are at the beginning of a 20% correction in the market” to the “market is consolidating and the bull market will continue with gains of 15% in 2014.”   The same bad news, depending on who you were listening to or reading,  was good news or confirming bad news for the markets.  It was anything but ho-hum.

VIX futures and options continued to trade a fevered pace.  The spot VIX had a range of 15.02 to 21.48.  It closed near the lows at 15.29 – down nearly 17% for the week.  The February VIX futures (VXG$) closed at a slight premium to the spot VIX (15.50 vs. 15.29.)    The February VIX future had closed last week  at discount of 0.81  to the spot. The backwardization of the futures to the spot disappeared in March.  The March VIX (VXH4) also closed at a premium to the spot VIX (15.60 vs. 15.29.)    The absence of backwardization (the spot trading higher than the futures) and the decrease in the spot volatility for all the indexes would seem to indicate an easing of the fear of a further sell-off.

Here is a capsule view of last week’s market numbers:

 

Index

Close

Weekly Change

% Weekly

% YTD

Volatility of  Index

Dow Jones Industrials (DJIA)

15,794.08

95.23

0.61%

-5.97%

14.91% (VXD)

S&P 500 (SPX)

1,797.02

14.43

0.81%

-3.60%

15.29% (VIX)

NASDAQ 100 (NDX)

3,561.91

39.99

1.14%

-1.13%

16.71% (VXN)

Russell 2000 (RUT)

1,114.73

-15.12

-1.34%

-5.74%

21.43% (RVX)

S&P 100 (OEX)

795.29

5.59

0.71%

-4.41%

14.05% (VXO)

CBOE Volatility Index (VIX)

15.29

-3.12

-16.95%

NA

 

This will be a quite week for economic reports.  Janet Yellen and other FOMC members will be on tour this weak.  The weaker than expected job numbers on Friday gave rise to speculation the Fed would have to end tapering or even ramp up bond buying.    Proponents of an impending end to tapering pointed to record outflows from mutual funds and exchanged-traded funds combined with record inflows to bond funds as a reason for continued concern.    Traders will be positioning themselves for a shortened trading the week of February 17th.  Be nimble and trade liquid products.
Earnings are finally starting to wind down.    This earnings cycle has been devoid of any major surprises.  In light of current market jitters, a major earnings surprise to the downside would be particularly unwelcome.  Major announcements include: Loews, Mosaic, Ingersoll-Rand, Reynolds American, Whole Foods, CBS, Cisco, Deere, MetLife, Pepsico, Borg-Warner, and Kraft..     Keep an eye on bellwether and “hot’ stocks.  I scan stocks announcing earnings the coming week using the following criteria:  Price > 20, 30 Day Implied Volatility > 20, and Average Daily Option Volume > 200 contracts.  It is your responsibility to confirm these earnings dates. Earnings dates can and do change.

 

Trading advice to remember:

  “Chance favors the Prepared Mind.” – Louis Pasteur

“All humans are alike and all humans are equal.

 It is just the perception of the eye that sees any different.” – Anonymous

Monday February 10:  

Economic:  TD Ameritrade IMX – 12:30.

International Economic:  China Unemployment – 1:45 AM.

Earnings:

Symbol

Company Name

Feb 7 Close

IV30

B/A

XEPS

CYOU Changyou.Com Ltd (ADR)

$28.09

72.9

B

$0.40

HAS Hasbro, Inc.

$49.66

38.2

B

$1.23

SOHU Sohu.com Inc

$70.39

60.4

B

($0.34)

SFUN SouFun Holdings Limited (ADR)

$76.01

58.7

B

$1.05

MAS Masco Corporation

$21.41

40.1

A

$0.17

PXD Pioneer Natural Resources

$180.18

42.4

A

$1.02

RAX Rackspace Hosting, Inc.

$37.70

77.9

A

$0.14

 

Tuesday February 11:

Economic:  INFIB Small Business Optimism Index – 7:30, ICSC Goldman Store Sales – 8:30, Redbook – 8:55, JOLTS – 10:00, Wholesale Trade – 10:00.

International Economic: No Major Announcements.

Other:  Federal Reserve Chair Janet Yellen’s monetary policy testimony released – 8:30, Philadelphia Federal Reserve Bank President Charles Plosser speech on economic outlook in Newark, Delaware – 9:00, Federal Reserve Chair Janet Yellen first semi-annual monetary policy testimony before House Financial Services Committee in Washington – 10:00, Richmond Federal Reserve Bank President Jeffrey Lacker speech on financial stability at Stanford University – 8:00 PM, Dallas Federal Reserve Bank President Richard Fisher speech on the economic outlook, in Dallas – 8:10 PM.

Optionable Earnings: 

Symbol

Company Name

Feb 7 Close

IV30

B/A

XEPS

AMX America Movil SAB de CV (ADR)

$21.07

30.8

D

$0.48

CVS CVS Caremark Corporation

$66.11

22.1

B

$1.11

HCP HCP, Inc.

$38.14

21.4

B

$0.74

HNT Health Net, Inc.

$32.09

48.0

B

$0.28

HUN Huntsman Corporation

$21.57

39.3

B

$0.36

IR Ingersoll-Rand PLC

$58.06

31.3

B

$0.61

ICE Intercontinentalexchange Group Inc

$210.42

26.1

B

$1.98

LGND Ligand Pharmaceuticals Inc.

$56.82

51.2

B

$0.20

MOS Mosaic Co

$46.21

28.6

B

$0.44

OMC Omnicom Group Inc.

$73.37

28.3

B

$1.17

PRLB Proto Labs Inc

$77.89

61.1

B

$0.35

REGN Regeneron Pharmaceuticals Inc

$287.03

45.0

B

$0.99

RAI Reynolds American, Inc.

$47.79

22.0

B

$0.81

ZTS Zoetis Inc

$30.05

24.9

B

$0.35

AXLL Axiall Corp

$40.25

41.5

A

$0.69

DVA DaVita HealthCare Partners Inc

$63.74

27.1

A

$0.98

EGN Energen Corporation

$71.99

37.1

A

$0.80

FEYE FireEye Inc

$66.27

74.5

A

($0.45)

FOSL Fossil Group Inc

$115.11

55.1

A

$2.45

PKG Packaging Corp Of America

$63.18

26.7

A

$0.89

PHH PHH Corporation

$23.83

36.3

A

$0.07

SGEN Seattle Genetics, Inc.

$41.65

59.1

A

($0.24)

TRIP Tripadvisor Inc

$77.14

56.1

A

$0.14

 

Wednesday February 12:

Economic:  MBA Purchase Applications – 7:00,  Atlanta Fed Business Inflation Expectations – 10:00,  EIA Petroleum Status Report –1 0:30.

International Economic:  No major announcements.

Other:  St. Louis Federal Reserve Bank President James Bullard speech on the economic outlook in New York – 8:35.

Optionable Earnings:

Symbol

Company Name

Feb 7 Close

IV30

B/A

XEPS

AB AllianceBernstein Holding LP

$21.88

27.7

B

$0.43

CSTE Caesarstone Sdot-Yam Ltd

$43.90

63.3

B

$0.39

DE Deere & Company

$85.43

22.1

B

$1.51

EZCH EZchip Semiconductor Ltd.

$24.31

58.8

B

$0.23

HSP Hospira, Inc.

$42.48

31.1

B

$0.50

INCY Incyte Corporation

$62.58

59.1

B

($0.09)

LO Lorillard Inc.

$48.41

28.8

B

$0.85

OC Owens Corning

$38.81

35.3

B

$0.28

PNK Pinnacle Entertainment, Inc

$22.00

44.5

B

$0.35

SBGI Sinclair Broadcast Group, Inc.

$29.50

48.3

B

$0.38

AEM Agnico Eagle Mines Ltd (USA)

$31.25

48.1

A

$0.20

CAR Avis Budget Group Inc.

$38.82

45.0

A

$0.12

CBS CBS Corporation

$60.29

28.7

A

$0.76

CTL CenturyLink, Inc.

$28.30

28.5

A

$0.59

CSCO Cisco Systems, Inc.

$22.49

35.1

A

$0.41

CXW Corrections Corp Of America

$32.84

25.6

A

$0.52

CTRP Ctrip.com International, Ltd. (ADR)

$38.67

75.1

A

$0.24

FNF Fidelity National Financial Inc

$30.68

29.1

A

$0.37

BGC General Cable Corporation

$27.94

50.5

A

$0.31

MET Metlife Inc

$48.59

26.6

A

$1.34

MDLZ Mondelez International Inc

$32.70

22.7

A

$0.44

NTAP NetApp Inc.

$41.71

36.3

A

$0.56

NTES NetEase, Inc (ADR)

$71.52

44.2

A

$1.41

SKX Skechers USA Inc

$27.78

48.5

A

$0.17

SPWR SunPower Corporation

$29.68

76.9

A

$0.28

TAL TAL International Group, Inc.

$43.16

47.9

A

$1.01

CAKE The Cheesecake Factory Incorporated

$44.36

33.3

A

$0.58

WFM Whole Foods Market, Inc.

$54.08

38.6

A

$0.44

Z Zillow Inc

$84.45

70.2

A

($0.05)

 

Thursday February 13:

Economic:  Jobless Claims – 8:30,   Retail Sales – 8:30, Bloomberg Consumer Comfort Index – 9:45, Business Inventories – 10:00, EIA Natural Gas Report – 10:30.

International Economic:  German PPI – 2:00 AM, China CPI – *:30 PM, China PPI – 8:30 PM.

Other:   Federal Reserve Chair Janet Yellen delivers second part of the semi-annual monetary policy testimony before Senate Banking Committee in Washington – 10:30.

Optionable Earnings: 

Symbol

Company Name

Feb 7 Close

IV30

B/A

XEPS

ABB ABB Ltd (ADR)

$25.10

24.6

B

$0.23

AFSI Amtrust Financial Services, Inc.

$31.83

97.7

B

$0.80

APA Apache Corporation

$79.92

24.6

B

$1.82

BWA BorgWarner Inc.

$53.44

28.6

B

$0.71

BG Bunge Ltd

$75.12

27.8

B

$2.11

BKW Burger King Worldwide Inc

$24.77

29.1

B

$0.23

CAB Cabelas Inc

$68.37

48.1

B

$1.41

CTB Cooper Tire & Rubber Co

$22.70

38.9

B

$0.68

DBD Diebold Incorporated

$33.57

30.6

B

$0.58

DISCA Discovery Communications Inc.

$81.94

26.4

B

$0.88

EQT EQT Corporation

$94.21

30.5

B

$0.66

GNRC Generac Holdings Inc.

$49.51

54.1

B

$0.89

GNC GNC Holdings Inc

$50.69

44.4

B

$0.65

GG Goldcorp Inc. (USA)

$24.84

36.2

B

$0.23

JAH Jarden Corp

$59.41

32.8

B

$1.31

MPEL Melco Crown Entertainment Ltd (ADR)

$40.52

51.7

B

$0.40

TAP Molson Coors Brewing Company

$51.67

25.4

B

$0.72

PBF PBF Energy Inc

$24.32

44.4

B

$0.54

RLGY Realogy Holdings Corp

$46.06

35.8

B

$0.26

SHPG Shire PLC (ADR)

$153.75

28.9

B

$2.03

HOT Starwood Hotels & Resorts Worldwide

$75.01

28.4

B

$0.70

TRGP Targa Resources Corp

$91.29

22.5

B

$0.50

TCK Teck Resources Ltd (USA)

$24.33

35.4

B

$0.42

GT The Goodyear Tire & Rubber Company

$23.23

40.1

B

$0.63

WWAV WhiteWave Foods Co

$23.49

35.6

B

$0.20

A Agilent Technologies Inc.

$58.29

31.6

A

$0.66

ALNY Alnylam Pharmaceuticals, Inc.

$75.72

56.6

A

($0.48)

AIG American International Group Inc

$47.72

28.6

A

$0.96

BCOR Blucora Inc

$24.34

66.3

A

$0.39

CLF Cliffs Natural Resources Inc

$20.81

66.0

A

$0.78

CRAY Cray Inc.

$29.93

63.8

A

$1.29

ELLI Ellie Mae Inc

$24.63

69.2

A

$0.04

ENOC EnerNOC, Inc.

$21.33

58.5

A

($0.76)

LBTYA Liberty Global PLC

$80.69

28.9

A

$0.38

PRAA Portfolio Recovery Associates, Inc.

$50.45

38.9

A

$0.89

TRLA Trulia Inc

$33.44

88.1

A

($0.10)

WTW Weight Watchers International, Inc.

$29.33

90.7

A

$0.60

 

Friday February 14:

Economic:  Import and Export Prices – 8:30, Industrial Production – 9:15, University of Michigan Consumer Sentiment – 9:55.

International Economic: EMU GDP Flash – 5:00 AM, EMU Merchandise Trade – 5:00 AM.

Optionable Earnings: 

Symbol

Company Name

Feb 7 Close

IV30

B/A

XEPS

CPB Campbell Soup Company

$40.02

27.3

B

$0.73

IPGP IPG Photonics Corporation

$69.27

49.0

B

$0.76

SNI Scripps Networks Interactive, Inc.

$74.44

28.6

B

$0.97

SJM The J.M. Smucker Company

$93.59

24.5

B

$1.67

TRW TRW Automotive Holdings Corp.

$72.64

31.9

B

$1.63

VTR Ventas, Inc.

$61.80

24.2

B

$1.06

VFC VF Corp

$57.43

35.1

B

$0.84

 

Monday February 17:

US Holiday – President’s Day – All US Markets Closed

International Economic:  No major announcements.

Optionable Earnings:  None meeting criteria.

Tuesday February 18:

Economic:  Empire State Manufacturing Survey – 8:30, Housing Market Index – 10:00, E-Commerce Retail Sales – 10:00.

International Economic: Great Britain CPI and PPI – 4:30 AM, Japan All Industry Index – 11:30 PM.

Optionable Earnings: 

Symbol

Company Name

Feb 7 Close

IV30

B/A

XEPS

MDT Medtronic, Inc.

$54.75

20.6

B

$0.91

B Rockwood Holdings, Inc.

$69.50

33.2

B

$0.31

ADI Analog Devices, Inc.

$48.35

22.8

A

$0.48

CF CF Industries Holdings, Inc.

$229.93

28.7

A

$4.53

FLR Fluor Corporation (NEW)

$76.03

29.1

A

$0.98

HLF Herbalife Ltd.

$67.83

77.5

A

$1.28

NPSP NPS Pharmaceuticals, Inc.

$33.53

63.7

A

$0.02

OII Oceaneering International

$68.98

31.1

A

$0.84

PNRA Panera Bread Co

$169.61

37.4

A

$1.95

PBPB Potbelly Corp

$21.19

64.8

A

$0.05

SM SM Energy Co.

$83.94

39.9

A

$1.42

TEX Terex Corporation

$40.41

44.5

A

$0.49

 

 

 

Papale on the Greeks

Ok now that we all know the markets are going up this year we can get down to business.  With the NFC Seattle Seahawks win this year, statistically the market should go up.  In years when the AFC teams win, markets are expected to fall.  This indicator has been accurate 37 out of 47 years.  Additionally years when the NFC won, GDP grows by an average of 3.1%, when the AFC wins GDP growth is 2.6%.  Pretty soon CNBC will have to start broadcasting football games.

The greeks – delta, gamma, theta and vega are useful measurements of risk.  For most retail traders not trading a large book of business with many options across many strikes they are useful largely for evaluating risk going into a trade and helping to understand how the trade is behaving during the life of the trade.  Keep in mind that all greeks are theoretical.  They are in fact mathematically derived within the options model.

In addition they are a snapshot in time and price and IV.  The greeks are risk gauges but as soon as the market moves or the clock ticks or IV changes, they in theory need to be recalculated.  In reality we can watch and use them for more than just a few minutes or a few ticks of the underlying.  But as markets really swing around as they have been recently, keep in mind the greeks will also change.  OptionVue software updates all these in real time so users can be assured all these are up to date.  But it is good to keep in mind that these can change dramatically in certain market conditions.

The Prepared Mind: February 3, 2014

January 2014 has ended with the markets not meeting trader and investor expectations.  Stocks and bond yields are down.  The January pullback for the major indexes ranged from 2.6% to 6.7%.    I have heard numerous reports selectively using numbers within the range.   The difference between 2.7% and “nearly 7%” is an order of magnitude which is used to color reports on the same occurrence.  These reports, and their selective use of “statistics”, bring to mind the classic “How to Lie with Statistics” by Darrell Huff.  The book highlights common errors, intentional and unintentional, associated with interpretation and use of statistics.

One of my favorite themes is “Correlation does not imply causation.”  Two constant threads in this weekend’s financial news fall under this category.  The first is the Super Bowl Stock Market Predictor.  This theory posits that when a team from the original National Football League wins the championships, stocks rise; when a team from the now-defunct American Football league wins, stocks fall.  The accuracy of this predictor is reported to be 81%.  The other “statistic” bandied about is that since 1950 January stock performance has predicted the direction of the market for the rest of the year 89% of the time. If the transitive property holds true (if a=b and b=c, then a=c) , then Denver is going to win the Super Bowl.  If Seattle wins which maxim rules the market?

VIX options set volume records in January,  VIX futures had their second largest monthly volume.  The difference between the spot VIX and the futures narrowed significantly this week.  The nearest two futures played catch up last week.  The VIX spot was up .27 or 1.50% while the February VIX future was up 1.40 (8.64%) and the March future was up 1.15 (7.10%.)  The move in the futures was not enough to remove the backwardation which appeared in the past few weeks.  The paper flow in VIX options was often bearish on the VIX and bullish on the market.  One was the largest trades this past Friday was the sale of the February 16/20 call spread for $1.20.

Here is a capsule view of last week’s market numbers:

Index

Close

Weekly Change

% Weekly

% YTD

Volatility of  Index

Dow Jones Industrials (DJIA)

15,698.85

-180.26

-1.14%

-6.70%

17.91% (VXD)

S&P 500 (SPX)

1,782.59

-7.70

-0.43%

-4.61%

18.41% (VIX)

NASDAQ 100 (NDX)

3,521.92

-19.56

-0.55%

-2.63%

18.97% (VXN)

Russell 2000 (RUT)

1,129.85

-11.43

-1.00%

-3.97%

22.90% (RVX)

S&P 100 (OEX)

789.70

-6.58

-0.83%

-5.28%

17.44% (VXO)

CBOE Volatility Index (VIX)

18.41

0.27

1.49%

NA

This is “Employment Week.”  The focus will be on the employment reports released the last three days of the trading week.  The week culminates with the release of the monthly Employment Situation Report released at 8:30 AM EST on Friday morning.  Another report with the potential to move the market is the January ISM Manufacturing.  Announcements from the European Central Bank and the Bank of England will provide an overview of the European and global economies.  The Chinese PMI Manufacturing Index on Thursday night should provide insight into concerns about the state of the Chinese economic machine.
Earnings are the wild card.  Major announcements will occur each day of the week.   This earnings cycle has been devoid of any major surprises.  In light of current market jitters, a major earnings surprise to the downside would be particularly unwelcome.  Major announcements include: Yum, Aflac, Gilead Sciences, CME Group, ADM, Merck, LinkedIn, Cummins, ADP, Allstate, and Cigna .     Keep an eye on bellwether and “hot’ stocks.  I scan stocks announcing earnings the coming week using the following criteria:  Price > 20, 30 Day Implied Volatility > 20, and Average Daily Option Volume > 200 contracts.  It is your responsibility to confirm these earnings dates. Earnings dates can and do change.

 

Trading advice to remember:

  “Chance favors the Prepared Mind.” – Louis Pasteur

“A judicious man looks on statistics not to get knowledge, but to save himself from having

 ignorance foisted on him.”  - Thomas Carlyle

Monday February 3:

Economic:  Motor Vehicle Sales, Gallup US Consumer Spending Measure – 8:30, PMI Manufacturing Index – 8:58, ISM Manufacturing Index – 10:00, Construction Spending – 10:00.

International Economic:  Chinese markets closed for Lunar New Year, EMU PMI Manufacturing Index – 4:30 AM.

Earnings:

Symbol

Company Name

Jan 31 Close

IV30

B/A

XEPS

GOLD Randgold Resources Ltd. (ADR)

$68.35

37.5

B

$0.73

SYY SYSCO Corporation

$35.15

22.1

B

$0.40

AGNC American Capital Agency Corp.

$20.72

25.1

A

$0.63

APC Anadarko Petroleum Corporation

$81.45

30.4

A

$0.93

CCK Crown Holdings, Inc.

$41.09

22.9

A

$0.50

CFN CareFusion Corporation

$41.71

39.9

A

$0.54

DNB Dun & Bradstreet Corp

$111.02

30.6

A

$2.85

EW Edwards Lifesciences Corp

$65.48

35.3

A

$0.83

HIG Hartford Financial Services Group Inc

$33.75

31.2

A

$0.90

HOLX Hologic, Inc.

$21.01

36.7

A

$0.31

OHI Omega Healthcare Investors Inc

$31.54

24.2

A

$0.60

SU Suncor Energy Inc. (USA)

$32.65

23.9

A

$0.83

YUM Yum! Brands, Inc.

$66.60

32.6

A

$0.80

 

Tuesday February 4:

Economic:  ICSC Goldman Store Sales – 8:30, Redbook – 8:55, S&P Case-Shiller HPI – 9:00, Consumer Confidence – 10:00, Richmond Fed Manufacturing Index – 10:00, Sate Street Investor Confidence – 10:00.

International Economic: Chinese markets closed for Lunar New Year, EMU PPI – 5:00 AM, Japan PMI Composite – 6:15, China PMI Composite – 8:45.

Other: Richmond Federal Reserve Bank President Jeffrey Lacker speech on the economic outlook in Winchester, Virginia – 8:30 AM, Chicago Federal Reserve Bank President Charles Evans speech on monetary challenges for 2014, in Detroit – 12:30 PM.

Optionable Earnings: 

Symbol

Company Name

Jan 31 Close

IV30

B/A

XEPS

ADM Archer Daniels Midland Company

$39.51

35.7

B

$0.84

AGCO AGCO Corporation

$54.43

30.1

B

$1.33

ARMH ARM Holdings plc (ADR)

$47.40

48.9

B

$0.21

BDX Becton, Dickinson and Co.

$107.98

22.8

B

$1.29

CME CME Group Inc

$74.32

25.0

B

$0.67

CNC Centene Corp

$60.91

40.1

B

$0.82

DLPH Delphi Automotive PLC

$60.98

28.8

B

$1.04

EMR Emerson Electric Co.

$66.58

22.7

B

$0.67

ETN Eaton Corporation PLC

$73.91

28.3

B

$1.06

GCI Gannett Co., Inc.

$27.60

34.2

B

$0.65

HCA HCA Holdings Inc

$49.49

31.0

B

$0.85

IP International Paper Company

$47.11

26.4

B

$0.87

KORS Michael Kors Holdings Ltd

$80.39

52.7

B

$0.86

MHFI McGraw Hill Financial Inc

$76.77

27.4

B

$0.79

R Ryder System, Inc.

$71.77

34.3

B

$1.29

AFL AFLAC Incorporated

$63.20

22.5

A

$1.39

AMP Ameriprise Financial, Inc.

$106.43

28.8

A

$1.82

ATW Atwood Oceanics, Inc.

$47.06

30.2

A

$1.16

BWLD Buffalo Wild Wings

$133.39

48.1

A

$1.06

CERN Cerner Corporation

$56.27

35.1

A

$0.34

CHRW C.H. Robinson Worldwide, Inc.

$58.28

34.9

A

$0.68

DATA Tableau Software Inc

$79.82

55.6

A

($0.06)

EXP Eagle Materials, Inc.

$78.02

37.1

A

$0.75

GILD Gilead Sciences, Inc.

$81.52

40.2

A

$0.49

GIMO Gigamon Inc

$28.02

63.5

A

$0.00

HAIN The Hain Celestial Group, Inc.

$93.70

39.4

A

$0.88

MYGN Myriad Genetics, Inc.

$27.10

58.9

A

$0.47

THOR Thoratec Corporation

$34.96

44.0

A

$0.29

XOOM Xoom Corp

$27.75

73.1

A

($0.03)

 

Wednesday February 5:

Economic:  MBA Purchase Applications – 7:00,  ADP Employment Report – 8:15, Gallup US Job Creation Index – 8:30, ISM Non-Manufacturing Index – 10:00,  EIA Petroleum Status Report –1 0:30.

International Economic:  No major announcements.

Other:  Philadelphia Federal Reserve Bank President Charles Plosser speech on economic outlook in Rochester – 12:30 PM, Atlanta Federal Reserve Bank President Dennis Lockhart speech on the economic outlook in Birmingham – 1:40 PM.

Optionable Earnings:

Symbol

Company Name

Jan 31 Close

IV30

B/A

XEPS

PHH PHH Corporation

$24.45

35.1

D

$0.07

AGN Allergan, Inc.

$115.11

30.7

B

$1.34

CCE Coca-Cola Enterprises Inc

$43.85

25.9

B

$0.52

CTSH Cognizant Technology Solutions Corp

$98.60

32.0

B

$1.05

EL Estee Lauder Companies Inc

$68.95

35.3

B

$1.05

GRA W.R. Grace & Co.

$94.28

30.6

B

$1.09

HUM Humana Inc

$98.17

32.0

B

$0.93

IACI IAC/InterActiveCorp

$70.59

45.1

B

$0.81

LAZ Lazard Ltd

$42.67

30.8

B

$0.60

LVLT Level 3 Communications, Inc.

$32.03

41.1

B

$0.05

MDC M.D.C. Holdings, Inc.

$30.24

37.1

B

$0.62

MPEL Melco Crown Entertainment Ltd (ADR)

$40.91

45.1

B

$0.39

MRK Merck & Co., Inc.

$53.51

20.7

B

$0.89

MTH Meritage Homes Corp

$47.03

44.5

B

$1.02

NDAQ NASDAQ OMX Group, Inc.

$38.41

27.0

B

$0.66

NS NuStar Energy L.P.

$48.51

30.8

B

$0.36

RL Ralph Lauren Corp

$158.23

34.2

B

$2.51

TWX Time Warner Inc

$63.40

25.0

B

$1.15

AKAM Akamai Technologies, Inc.

$48.47

52.2

A

$0.43

ALL The Allstate Corporation

$52.30

23.5

A

$1.38

ARRS Arris Group Inc

$25.86

45.0

A

$0.42

BOFI BofI Holding, Inc.

$82.68

36.1

A

$0.90

CBG CBRE Group Inc

$26.72

33.3

A

$0.66

CNW Con-way Inc

$39.14

45.9

A

$0.21

DIS The Walt Disney Company

$73.22

24.5

A

$0.90

FISV Fiserv, Inc.

$56.78

22.5

A

$0.81

FLT FleetCor Technologies, Inc.

$110.12

41.4

A

$1.01

FMC FMC Corp

$71.86

23.4

A

$0.95

GMCR Green Mountain Coffee Roasters Inc.

$79.15

58.8

A

$0.88

GPRE Green Plains Renewable Energy Inc.

$21.97

66.1

A

$0.41

IRBT iRobot Corporation

$35.49

59.6

A

$0.11

LNC Lincoln National Corporation

$48.00

32.9

A

$1.27

MRO Marathon Oil Corporation

$33.04

23.9

A

$0.74

NSH NuStar GP Holdings, LLC

$28.07

41.1

A

$0.86

NXPI NXP Semiconductors NV

$47.85

39.2

A

$0.86

ORLY O’Reilly Automotive Inc

$132.29

34.2

A

.1.32

P Pandora Media Inc

$36.53

70.5

A

$0.01

PRU Prudential Financial Inc

$85.21

28.5

A

$2.24

SFLY Shutterfly, Inc.

$47.46

72.7

A

$1.09

SWI SolarWinds Inc

$40.25

60.6

A

$0.29

SWIR Sierra Wireless, Inc. (USA)

$20.90

60.6

A

$0.03

TSO Tesoro Corporation

$51.26

41.1

A

$0.30

TWTR Twitter Inc

$63.47

89.2

A

($0.10)

XL XL Group plc

$29.27

23.6

A

$0.84

YELP Yelp Inc

$75.47

87.0

A

$0.02

 

Thursday February 6:

Economic:  Chain Store Sales, Challenger Job-Cut Report – 7:30, Gallup US Payroll to Population – 8:30, International Trade – 8:30, Productivity Costs – 8:30, Jobless Claims – 8:30,   Bloomberg Consumer Comfort Index – 9:45,  EIA Natural Gas Report – 10:30.

International Economic:  Bank of England (BOE) Announcement – 7:00 AM, European Central Bank (ECB) Announcement – 7:45.

Optionable Earnings: 

Symbol

Company Name

Jan 31 Close

IV30

B/A

XEPS

AAP Advance Auto Parts, Inc.

$115.20

32.9

B

$0.79

ADS Alliance Data Systems Corporation

$248.95

30.6

B

$2.18

AET Aetna Inc

$68.85

27.8

B

$1.38

ALKS Alkermes Plc

$49.68

49.4

B

$0.08

ALR Alere Inc

$38.03

42.9

B

$0.56

AOL AOL, Inc.

$46.25

57.2

B

$0.48

AZN AstraZeneca plc (ADR)

$64.04

20.4

B

$1.28

CMI Cummins Inc.

$128.48

30.0

B

$1.98

CVRR CVR Refining LP

$22.10

30.7

B

$0.35

DNKN Dunkin Brands Group Inc

$46.21

27.9

B

$0.40

DO Diamond Offshore Drilling Inc

$49.00

27.7

B

$0.78

EXC Exelon Corporation

$28.99

23.5

B

$0.53

FLO Flowers Foods, Inc.

$21.09

33.3

B

$0.18

FOXA Twenty-First Century Fox Inc

$32.02

28.1

B

$0.34

GM General Motors Company

$36.84

33.3

B

$0.88

HCLP Hi-Crush Partners LP

$37.66

37.9

B

$0.62

HLSS Home Loan Servicing Solutions Ltd

$20.93

26.3

B

$0.50

KKR KKR & Co. L.P.

$24.45

35.2

B

$0.83

MDSO Medidata Solutions Inc

$64.16

75.0

B

$0.26

NBL Noble Energy, Inc.

$62.98

30.2

B

$0.66

NILE Blue Nile Inc

$43.04

45.0

B

$0.42

NUS Nu Skin Enterprises, Inc.

$84.69

80.5

B

$1.91

PRGO Perrigo Company PLC

$155.90

31.5

B

$1.60

PTEN Patterson-UTI Energy, Inc.

$25.70

34.4

B

$0.22

SALE RetailMeNot Inc

$35.54

65.5

B

$0.26

SEE Sealed Air Corp

$31.39

33.9

B

$0.37

SIAL Sigma-Aldrich Corporation

$93.88

21.4

B

$1.01

SPR Spirit AeroSystems Holdings, Inc.

$33.90

43.4

B

$0.66

TDC Teradata Corporation

$42.13

48.9

B

$0.79

TEVA Teva Pharmaceutical Industries Ltd (ADR)

$45.58

27.7

B

$1.40

USG USG Corporation

$30.12

42.2

B

$0.11

VMC Vulcan Materials Company

$61.68

36.9

B

($0.03)

ATHN athenahealth, Inc

$145.29

43.2

A

$0.28

BYI Bally Technologies Inc.

$72.78

37.3

A

$1.02

EXPE Expedia Inc

$65.52

65.4

A

$0.75

FTI FMC Technologies, Inc.

$49.91

31.7

A

$0.65

IMPV Imperva Inc

$55.45

61.1

A

($0.03)

LGF Lions Gate Entertainment Corp. (USA)

$32.31

41.6

A

$0.53

LNKD LinkedIn Corp

$212.40

60.3

A

$0.09

NCR NCR Corporation

$35.50

43.5

A

$0.80

OPEN OpenTable Inc

$76.31

53.1

A

$0.40

OUTR Outerwall Inc

$64.30

51.1

A

$1.23

SFM Sprouts Farmers Market Inc

$35.10

48.4

A

$0.06

THRX Theravance Inc

$37.96

49.0

A

($0.40)

TPX Tempur Sealy International Inc

$49.19

59.8

A

$0.53

UBNT Ubiquiti Networks Inc

$41.97

73.0

A

$0.44

VRSN Verisign, Inc.

$59.44

27.0

A

$0.54

WWWW Web.com Group Inc

$33.28

54.9

A

$0.50

 

Friday February 7:

Economic:  Monthly Employment Situation – 8:30.

International Economic: China Adjusted Retail Sales – 3:15 AM, German Industrial Production – 6:00 AM.

Optionable Earnings: 

Symbol

Company Name

Jan 31 Close

IV30

B/A

XEPS

APO Apollo Global Management LLC

$32.71

41.2

B

$0.80

BPL Buckeye Partners, L.P.

$72.38

23.6

B

$0.85

CBOE CBOE Holdings, Inc

$51.40

27.8

B

$0.48

CI CIGNA Corporation

$87.65

26.4

B

$1.48

LH Laboratory Corp. of America Holdings

$89.06

24.5

B

$1.67

LQDT Liquidity Services, Inc.

$23.50

60.3

B

$0.16

MCO Moody’s Corporation

$75.17

32.2

B

$0.77

WYN Wyndham Worldwide Corporation

$71.74

26.5

B

$0.74

CCJ Cameco Corporation (USA)

$22.00

30.8

A

$0.46

 

Monday February 10:

Economic:  TD Ameritrade IMX – 12:30.

International Economic:  EMU PMI Manufacturing Index – 4:30 AM.

Optionable Earnings:

Symbol

Company Name

Jan 31 Close

IV30

B/A

XEPS

BWP Boardwalk Pipeline Partners, LP

$24.72

23.1

B

$0.31

CYOU Changyou.Com Ltd (ADR)

$30.24

67.4

B

$0.40

HAS Hasbro, Inc.

$51.24

30.5

B

$1.23

SOHU Sohu.com Inc

$73.62

58.1

B

($0.34)

MAS Masco Corporation

$21.22

39.8

A

$0.17

PXD Pioneer Natural Resources

$172.39

42.6

A

$1.06

RAX Rackspace Hosting, Inc.

$36.53

69.5

A

$0.14

 

 

Papale on Sell-offs

I don’t like to talk about weather all the time.  It seems like people who do that just can’t come up with anything to say.  But I have to go there today.  It been stupid cold here.  And we have a ton of snow.  And wind.  This is how I imagine it would be living in Antarctica.  We have resorted to watching the daily sunrise and sunset times and getting excited for the 2 minutes more of sunlight each day.  Groundhog day on Sunday.  Come on Phil.  Give me an  early spring.

Well what a difference a week can make.  Markets have seem to taken on a new look in the last week with some sharp sell-offs spurred by overseas concerns.  Vols are up and for those who have short gamma, theta collecting positions, it is likely that for the first time in a long time, adjustments were made on a move to the downside.  Note that as markets sell-off, vols go up.  Nothing new there.  For those that have out of the money puts you will notice something different than we see when markets rally and look at the out of the money calls.

On these sell-offs,  puts tend to move up much more uniformly and further out of the money than the out of the money calls do when we rally.  So if you are short a put spread, your long further out of the money put tends to move up nicely with the sell-off, acting as protection for your short put.  On the rallies, often times, depending on where we place our long and short calls,  our long call tends to barely move up on rallies, providing limited protection against short call.  This is mostly due to steeper volatility skew on the calls compared to the puts.  Take advantage of that when placing spreads.

The Prepared Mind: January 27, 2014

Roseanne Roseannadanna used to remind us “Well Jane, it goes to show you, it’s always something. If it ain’t one thing, it’s another.”  This week it was another thing.  The bull market was placed on the back burner by analysts. It remains to see if these market seers declare the end to the parabolic move.  The market experienced it’s greatest one week sell-off since mid-2012.  The Dow Jones Industrials led the decline with a loss of 3.52%.  The other major indexes showed declines of 1.5% to 2.5%.  Prior to Thursday’s US market opening, poor Chinese economic numbers led worldwide market declines.  This selling spread to the US markets on Thursday and Friday.  This international turmoil and economic uncertainty led to a move by investors to a “risk-off “ stance.

The VIX rose over 45% to 18.14.  The move of nearly 6 points was the largest weekly move in the VIX since 2010.  A number of market analysts have use this move in the cash VIX as a confirmation of the beginning of the end of the bull market.  The move to the 18.14 level by the VIX spot index was not confirmed by the VIX futures.  VIX options trade with VIX futures as the underlying. The February and March VIX futures (Symbols VXG4 and VXH4 respectively) each closed at 16.20.  The February future was up 1.95 or 14%, while the March future was up .90 or 6%.   The difference between the spot VIC and the futures is significant.  Trade in the VIX futures did not confirm the fear cited by many analysts.  In fact, the trade appears to indicate an expectation the market will recover between now and the expiration of the February VIX future on February 19.

Here is a capsule view of last week’s market numbers:

Index

Close

Weekly Change

% Weekly

% YTD

Volatility of  Index

Dow Jones Industrials (DJIA)

15,879.11

-579.45

-3.52%

-5.32%

17.43% (VXD)

S&P 500 (SPX)

1,790.29

-48.41

-2.63%

-4.07%

18.14% (VIX)

NASDAQ 100 (NDX)

3,541.48

-49.77

-1.39%

-1.90%

18.84% (VXN)

Russell 2000 (RUT)

1,141.28

-26.54

-2.27%

-2.62%

20.71% (RVX)

S&P 100 (OEX)

796.28

-21.05

-2.58%

-4.26%

16.33% (VXO)

CBOE Volatility Index (VIX)

18.14

5.70

45.82%

NA

 

It will be a busy week.  All eyes will be on Monday’s opening to see if there is a continuation of last week’s sell-off.  The President will be delivering his State of the Union address on Monday.  There is anticipation the last FOMC meeting with Ben Bernanke as chairman will bring the announcement of another $10 billion reduction in the Fed’s bond purchase program.  Economic reports will focus on housing and regional manufacturing. Last week’s perceived turmoil will insure perusal of the releases with a more jaundiced eye than usual.

 
This will be the week with the largest number of earnings announcements in this cycle.  This earnings cycle has been devoid of any major surprises.  Apple starts the week off with earnings announced before Monday’s opening,  Other notable earnings include Caterpillar, US Steel, American Airlines, AT&T, Ford, Pfizer, Yahoo, 3M, Amazon, Exxon Mobil, Google, Visa, and Grumman.     Keep an eye on bellwether and “hot’ stocks.  I scan stocks announcing earnings the coming week using the following criteria:  Price > 20, 30 Day Implied Volatility > 20, and Average Daily Option Volume > 200 contracts.  It is your responsibility to confirm these earnings dates. Earnings dates can and do change.

 

Trading advice to remember:

  “Chance favors the Prepared Mind.” – Louis Pasteur

“”All option strategies work; no option strategy works all the time.” – Alex Jacobson

Monday January 27:

Economic:  New Home Sales – 10:00 AM, Dallas Fed Manufacturing Survey – 10:30.

Other:  President Barack Obama delivers the State of the Union address.

International Economic:  Japan Merchandise Trade 6:50 PM on Sunday January 26.

Earnings:

Symbol

Company Name

Jan 24 Close

IV30

B/A

XEPS

AAPL Apple Inc.

$556.18

33.3

B

$14.04

CAT Caterpillar Inc.

$88.48

22.6

B

$1.29

RCL Royal Caribbean Cruises Ltd.

$48.86

34.7

B

$0.18

RYN Rayonier Inc.

$41.81

24.7

B

$0.49

ASH Ashland Inc.

$97.04

35.5

A

$1.33

OLN Olin Corporation

$27.96

29.7

A

$0.29

PCL Plum Creek Timber Co. Inc.

$43.62

23.4

A

$0.28

STX Seagate Technology PLC

$60.74

39.1

A

$1.40

SWFT Swift Transportation Co

$21.84

44.3

A

$0.35

X United States Steel Corporation

$26.34

47.4

A

($0.26)

ZION Zions Bancorporation

$31.16

27.7

A

$0.45

 

Tuesday January 28:

Economic:  ICSC Goldman Store Sales – 8:30, Redbook – 8:55, S&P Case-Shiller HPI – 9:00, Consumer Confidence – 10:00, Richmond Fed Manufacturing Index – 10:00, Sate Street Investor Confidence – 10:00.

International Economic: Great Britain GDP – 4:30 AM.

Other: FOMC Meeting Begins. 

Optionable Earnings: 

Symbol

Company Name

Jan 24 Close

IV30

B/A

XEPS

AAL American Airlines Group Inc

$31.35

38.2

B

$0.54

APD Air Products & Chemicals, Inc.

$111.01

26.2

B

$1.33

CHKP Check Point Software Technologies Ltd.

$65.33

30.1

B

$0.89

CIT CIT Group Inc.

$49.19

28.5

B

$0.87

CMCSA Comcast Corporation

$53.08

24.8

B

$0.68

CMCSK Comcast Corporation

$51.20

25.1

B

$0.69

DD E I Du Pont De Nemours And Co

$61.75

23.0

B

$0.55

DHI D.R. Horton, Inc.

$21.96

40.5

B

$0.30

DHR Danaher Corporation

$77.11

24.1

B

$0.95

LXK Lexmark International Inc

$35.93

40.3

B

$1.09

NEE NextEra Energy, Inc.

$88.80

22.1

B

$0.96

NUE Nucor Corporation

$50.16

23.9

B

$0.40

OSIS OSI Systems, Inc.

$59.22

50.8

B

$0.80

OSK Oshkosh Corporation

$53.77

42.5

B

$0.31

PII Polaris Industries Inc.

$137.45

37.1

B

$1.55

TROW T. Rowe Price Group, Inc.

$79.92

23.2

B

$1.03

WAT Waters Corporation

$104.58

27.1

B

$1.61

WRLD World Acceptance Corp.

$87.29

50.2

B

$1.65

ACE ACE Limited

$94.18

21.5

A

$2.00

AMGN Amgen, Inc.

$123.60

26.3

A

$1.64

BXP Boston Properties, Inc.

$106.90

22.9

A

$1.24

CRUS Cirrus Logic, Inc.

$20.14

62.0

A

$0.68

EA Electronic Arts Inc.

$23.87

47.7

A

$1.16

ILMN Illumina, Inc.

$144.10

44.8

A

$0.44

OI Owens-Illinois Inc

$33.25

30.0

A

$0.52

RKT Rock-Tenn Company

$99.77

33.5

A

$1.77

VMW VMware, Inc.

$97.70

36.2

A

$0.76

YHOO Yahoo! Inc.

$39.39

40.5

A

$0.30

 

Wednesday January 29:

Economic:  MBA Purchase Applications – 7:00,  EIA Petroleum Status Report –1 0:30.

International Economic:  Japan PMI Manufacturing – 6:15PM, China PMI Manufacturing – 8:45 PM.

Other:  FOMC Meeting Announcement – 2:00.

Optionable Earnings:

Symbol

Company Name

Jan 24 Close

IV30

B/A

XEPS

BA The Boeing Company

$141.31

26.3

B

$1.58

BABY Natus Medical Inc

$25.43

64.9

B

$0.32

BIIB Biogen Idec Inc

$314.96

38.6

B

$2.22

CP Canadian Pacific Railway Limited (USA)

$148.05

28.2

B

$1.84

CVLT CommVault Systems, Inc.

$75.97

49.1

B

$0.31

DOW The Dow Chemical Company

$44.72

28.4

B

$0.43

EMC EMC Corporation

$26.22

26.0

B

$0.50

GNTX Gentex Corporation

$33.74

36.4

B

$0.43

HES Hess Corp.

$77.40

24.2

B

$1.09

MPC Marathon Petroleum Corp

$85.44

38.0

B

$1.14

MWV MeadWestvaco Corp.

$36.98

27.6

B

$0.23

PSX Phillips 66

$77.20

28.0

B

$1.00

ROK Rockwell Automation

$117.01

27.5

B

$1.39

TUP Tupperware Brands Corporation

$87.75

32.0

B

$1.83

VLO Valero Energy Corporation

$51.25

34.7

B

$1.70

WLP WellPoint, Inc.

$85.79

29.6

B

$0.86

AVB AvalonBay Communities Inc

$120.65

21.3

A

$1.62

CAVM Cavium Inc

$35.46

48.2

A

$0.14

CLB Core Laboratories N.V.

$189.10

31.6

A

$1.40

CNQR Concur Technologies, Inc.

$114.44

40.9

A

($0.09)

CTXS Citrix Systems, Inc.

$59.67

41.9

A

$0.79

FB Facebook Inc

$56.63

59.3

A

$0.21

FTNT Fortinet Inc

$21.36

64.9

A

$0.09

INVN InvenSense Inc

$20.97

71.6

A

$0.12

LRCX Lam Research Corporation

$54.04

34.1

A

$1.03

LVS Las Vegas Sands Corp.

$78.72

37.6

A

$0.85

MLNX Mellanox Technologies, Ltd.

$42.56

65.3

A

($0.05)

MUR Murphy Oil Corporation

$62.51

24.6

A

$1.12

NOW ServiceNow Inc

$62.46

52.0

A

($0.16)

NSR Neustar Inc

$45.57

49.7

A

$0.77

QCOM QUALCOMM, Inc.

$75.87

22.3

A

$1.10

SYMC Symantec Corporation

$23.62

36.3

A

$0.39

TSCO Tractor Supply Company

$71.87

33.6

A

$0.65

VPRT VistaPrint Limited

$50.82

46.3

A

$1.00

VRTX Vertex Pharmaceuticals Incorporated

$83.83

46.5

A

($0.71)

 

Thursday January 30:

Economic:  Jobless Claims – 8:30, GDP – 8:30,  Bloomberg Consumer Comfort Index – 9:45, Pending Home Sales Index – 10:00,  EIA Natural Gas Report – 10:30.

International Economic:  EMU Economic Sentiment – 5:00 AM, Japan CPI 6:30 PM, Japan Industrial Production 6:50 PM.

Optionable Earnings: 

Symbol

Company Name

Jan 24 Close

IV30

B/A

XEPS

ABFS Arkansas Best Corporation

$34.95

55.8

B

$0.31

ADT ADT Corp

$39.02

26.8

B

$0.49

ALXN Alexion Pharmaceuticals, Inc.

$137.94

47.6

B

$0.73

AN AutoNation, Inc.

$48.38

28.9

B

$0.77

ATK Alliant Techsystems Inc.

$133.39

31.7

B

$1.98

BC Brunswick Corporation

$42.72

38.6

B

$0.13

BEN Franklin Resources, Inc.

$56.18

26.5

B

$0.93

BX The Blackstone Group L.P.

$31.81

40.9

B

$0.81

BZH Beazer Homes USA, Inc.

$23.49

45.9

B

($0.25)

CAH Cardinal Health Inc

$66.96

24.3

B

$0.83

CAM Cameron International Corporation

$58.09

38.5

B

$0.96

CELG Celgene Corporation

$168.55

33.7

B

$1.39

CRR CARBO Ceramics Inc.

$111.54

59.4

B

$0.82

DOV Dover Corp

$94.08

24.1

B

$1.28

ESI ITT Educational Services, Inc.

$44.15

60.7

B

$1.08

HAR Harman International Industries Inc

$89.59

39.2

B

$0.98

HOG Harley-Davidson, Inc.

$65.89

29.2

B

$0.32

HP Helmerich & Payne, Inc.

$87.23

27.1

B

$1.45

HSH Hillshire Brands Co

$34.37

34.8

B

$0.50

IVZ Invesco Ltd.

$34.99

27.6

B

$0.57

LLY Eli Lilly & Co.

$55.15

20.4

B

$0.73

MAN ManpowerGroup Inc.

$84.34

33.3

B

$1.26

MD Mednax Inc.

$54.70

24.1

B

$0.75

MGAM Multimedia Games Holding Company Inc

$35.24

59.3

B

$0.29

MMM 3M Co

$134.71

20.1

B

$1.61

NOC Northrop Grumman Corporation

$117.50

22.1

B

$1.94

OXY Occidental Petroleum Corporation

$89.42

22.6

B

$1.71

PBI Pitney Bowes Inc.

$22.38

51.6

B

$0.44

PLD Prologis Inc

$37.42

22.5

B

$0.42

POT Potash Corp./Saskatchewan (USA)

$32.94

26.0

B

$0.33

RGLD Royal Gold, Inc USA)

$56.05

36.8

B

$0.25

RTN Raytheon Company

$91.10

22.0

B

$1.35

RYL The Ryland Group, Inc.

$43.04

38.8

B

$1.17

SHW Sherwin-Williams Company

$195.12

25.5

B

$1.27

TEN Tenneco Inc

$56.64

34.6

B

$0.84

TKR The Timken Company

$55.52

32.7

B

$0.72

TMO Thermo Fisher Scientific Inc.

$112.81

25.1

B

$1.38

UA Under Armour Inc

$83.90

39.0

B

$0.53

V Visa Inc

$228.25

27.7

B

$2.16

VIAB Viacom, Inc.

$83.52

24.0

B

$1.15

WHR Whirlpool Corporation

$153.33

35.7

B

$3.00

ZMH Zimmer Holdings, Inc.

$95.38

22.7

B

$1.61

ALGN Align Technology, Inc.

$63.40

54.5

A

$0.43

AMZN Amazon.com, Inc.

$399.87

36.4

A

$0.71

BCR C.R. Bard, Inc.

$135.94

21.5

A

$1.39

BRCM Broadcom Corporation

$29.77

35.3

A

$0.38

CMG Chipotle Mexican Grill, Inc.

$503.45

39.5

A

$2.51

CNI Canadian National Railway (USA)

$53.78

20.8

A

$0.74

CSC Computer Sciences Corporation

$55.89

38.6

A

$0.84

CTCT Constant Contact Inc

$31.54

58.5

A

$0.16

EMN Eastman Chemical Company

$76.20

28.2

A

$1.25

GDOT Green Dot Corporation

$25.70

57.9

A

$0.17

GOOG Google Inc

$1,160.10

31.7

A

$10.39

MCK McKesson Corporation

$172.37

23.8

A

$1.86

MTW Manitowoc Company, Inc.

$25.05

40.7

A

$0.33

N NetSuite Inc

$112.73

40.6

A

($0.17)

RVBD Riverbed Technology, Inc.

$20.01

34.8

A

$0.19

TXTR Textura Corp

$32.86

71.5

A

($0.21)

 

Friday January 31:

Economic:  Personal Income and Outlays – 8:30, Employment Cost Index – 8:30, Chicago PMI – 9:45,  Reuter’s/University of Michigan Consumer Sentiment – 9:55.

International Economic: EMU Unemployment Rate – 5:00 AM, China CFLP Manufacturing PMI – 8:00 PM,

Optionable Earnings: 

Symbol

Company Name

Jan 24 Close

IV30

B/A

XEPS

ABBV AbbVie Inc

$48.87

27.8

B

$0.83

AON Aon PLC

$81.29

25.1

B

$1.52

CNX CONSOL Energy Inc.

$38.00

31.0

B

$0.08

LEA Lear Corporation

$79.36

25.7

B

$1.53

LM Legg Mason Inc

$43.94

26.7

B

$1.00

MA Mastercard Inc

$82.36

27.0

B

$0.60

MAT Mattel, Inc.

$42.96

28.1

B

$1.20

MJN Mead Johnson Nutrition CO

$80.59

39.8

B

$0.77

NOV National-Oilwell Varco, Inc.

$76.12

24.6

B

$1.39

NWL Newell Rubbermaid Inc.

$31.57

23.8

B

$0.46

PCAR PACCAR Inc

$58.25

25.1

B

$0.92

TSN Tyson Foods, Inc.

$35.46

31.1

B

$0.65

WY Weyerhaeuser Company

$30.56

23.0

B

$0.27

 

Monday February 3:

Economic:  Motor Vehicle Sales, Gallup US Consumer Spending Measure – 8:30, PMI Manufacturing Index – 8:58, ISM Manufacturing Index – 10:00, Construction Spending – 10:00, New Home Sales – 10:00 AM, Dallas Fed Manufacturing Survey – 10:30.

International Economic:  EMU PMI Manufacturing Index – 4:30 AM.

Optionable Earnings:

Symbol

Company Name

Jan 24 Close

IV30

B/A

XEPS

CYOU Changyou.Com Ltd (ADR)

$30.90

59.4

B

$0.39

GOLD Randgold Resources Ltd. (ADR)

$69.41

36.4

B

$0.66

SOHU Sohu.com Inc

$75.10

57.1

B

$0.34

SYY SYSCO Corporation

$36.11

20.4

B

$0.40

AGNC American Capital Agency Corp.

$20.84

22.8

A

$0.63

APC Anadarko Petroleum Corporation

$82.88

27.0

A

$0.95

CCK Crown Holdings, Inc.

$42.25

22.1

A

$0.50

CFN CareFusion Corporation

$40.33

25.8

A

$0.54

EW Edwards Lifesciences Corp

$68.29

33.3

A

$0.83

GGP General Growth Properties Inc

$20.15

24.0

A

$0.35

HIG Hartford Financial Services Group Inc

$33.83

29.3

A

$0.89

HOLX Hologic, Inc.

$21.94

33.7

A

$0.31

SU Suncor Energy Inc. (USA)

$34.07

21.2

A

$0.83

YUM Yum! Brands, Inc.

$69.80

26.8

A

$0.80