Douglas Davenport

February 20, 2020 - MDT Alert (ZEN)

Today I would like to make a suggestion on a stock that I believe should follow through to the downside.

That stock is Zendesk, Inc. (ZEN).

ZEN is trading around $87.61 as I write this

I am going to suggest an uneven straddle with a bearish bias.

And I am going to suggest you trade the March monthly options.

The suggestion will be an unequal straddle with a bearish bias.

The idea will be buy 2 puts for every 1 call.

Buy to Open (1) March 20th - $87.50 call @ $3.60
The 1 call will cost $360.

Buy to Open (2) March 28th - $87.50 put @ $3.00
The two puts will cost $600.

The total position will cost $960 or about 1% of the nominal portfolio.

The end result if you trade the suggested position size, is that you will own (1) March 20th - $87.50 calls and (2) March 20th - $87.50 puts.

Mad Hedge Fund Trader

February 20, 2020 - MDT Pro Tips A.M.

While the Diary of a Mad Hedge Fund Trader focuses on investment over a one week to a six-month time frame, Mad Day Trader, provided by Bill Davis, will exploit money-making opportunities over a brief ten minute to three-day window. It is ideally suited for day traders, but can also be used by long-term investors to improve market timing for entry and exit points. Read more

Mad Hedge Fund Trader

February 19, 2020 - MDT Pro Tips A.M.

While the Diary of a Mad Hedge Fund Trader focuses on investment over a one week to a six-month time frame, Mad Day Trader, provided by Bill Davis, will exploit money-making opportunities over a brief ten minute to three-day window. It is ideally suited for day traders, but can also be used by long-term investors to improve market timing for entry and exit points. Read more

Mad Hedge Fund Trader

February 18, 2020 - MDT Pro Tips A.M.

While the Diary of a Mad Hedge Fund Trader focuses on investment over a one week to a six-month time frame, Mad Day Trader, provided by Bill Davis, will exploit money-making opportunities over a brief ten minute to three-day window. It is ideally suited for day traders, but can also be used by long-term investors to improve market timing for entry and exit points. Read more

Mad Hedge Fund Trader

February 14, 2020 - MDT Pro Tips A.M.

While the Diary of a Mad Hedge Fund Trader focuses on investment over a one week to a six-month time frame, Mad Day Trader, provided by Bill Davis, will exploit money-making opportunities over a brief ten minute to three-day window. It is ideally suited for day traders, but can also be used by long-term investors to improve market timing for entry and exit points. Read more

Mad Hedge Fund Trader

February 13, 2020 - MDT Pro Tips A.M.

While the Diary of a Mad Hedge Fund Trader focuses on investment over a one week to a six-month time frame, Mad Day Trader, provided by Bill Davis, will exploit money-making opportunities over a brief ten minute to three-day window. It is ideally suited for day traders, but can also be used by long-term investors to improve market timing for entry and exit points. Read more

Mad Hedge Fund Trader

February 12, 2020 - MDT Pro Tips A.M.

While the Diary of a Mad Hedge Fund Trader focuses on investment over a one week to a six-month time frame, Mad Day Trader, provided by Bill Davis, will exploit money-making opportunities over a brief ten minute to three-day window. It is ideally suited for day traders, but can also be used by long-term investors to improve market timing for entry and exit points. Read more

Douglas Davenport

February 11, 2020 - MDT Alert (KEX)

With the market literally sitting up against the extreme upper band on the daily chart, I am real quick to pull the trigger on a deal if it is not making a strong push.

And because of that, I am going to suggest you close the KEX position.

Sell to Close (2) March 20th - $75.00 calls @ $3.10
The 2 calls will cost $5.20

Sell to Close (1) March 20th - $75.00 put @ 2.70

The total credit will be $8.80 per position.

Closing the position will result in a small profit of about $120.00.

Mad Hedge Fund Trader

February 11, 2020 - MDT Pro Tips A.M.

While the Diary of a Mad Hedge Fund Trader focuses on investment over a one week to a six-month time frame, Mad Day Trader, provided by Bill Davis, will exploit money-making opportunities over a brief ten minute to three-day window. It is ideally suited for day traders, but can also be used by long-term investors to improve market timing for entry and exit points. Read more

Mad Hedge Fund Trader

February 10, 2020 - MDT Alert (IRBT)

Today, I would like to make a suggestion on a stock that I believe should continue to get a bounce and follow through to the upside.

The stock is iRobot Corp (IRBT).

I would like to use the same structure as the trade we just put on with KEX.

That is the unequal straddle.

IRBT reported on February 7th, so there is no scheduled earnings event in the near future.

IRBT is trading around $52.54 as I write this.

The suggestion will be an unequal straddle with a bullish bias.
 
The idea will be to buy 2 calls for every 1 put.

Buy to Open (2) February 28th - $52.50 calls @ $2.40. The 2 calls will cost $4.80

Buy to Open (1) February 28th - $52.50 put @ $2.50

The total debit will be $7.30 per position.

Based on the nominal portfolio, limit the trade to a 2 lot or a total of $1,460.  This is a 1.5% risk based on the nominal portfolio.

The end result if you trade the suggested position size is that you will own (4) February 28th - $52.50 calls and (2) February 28th - $52.50 puts.

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