Carnival
From time to time I find an option that seems to be just about free.
One I've come across this time is Carnival (symbol CCL). Here's the chart; no broken trendline yet, but there seems to be a topping pattern completed (highlighted in green) which also seems similar to an earlier top that preceded a fall (other, earlier green).
At the moment, the January 2007 $50 put on this has an ask price of $9.40 (its symbol is .CCLMJ), and the stock is at $41. That means you are paying 40 cents for the time premium between now and seven months from now. To me that's ridiculous, and a great bargain. I bought some of these thing morning with a contingent stop price of $49.30
3 comments:
This is an interesting stock - it is showing 5 inside days (including today) off the long candle of a week ago. It will go where the market goes (actually it seems to have led back in May).
SPY is showing 7! inside days off a long candle. Amazing! It looks to me like it is forming a pennant.
kimberlysgarden,
try a 15 yr or 20yr daily chart....
OMDM
Thanks Tim, for pointing out what a bargain option is. Now that I understand them a bit, I can understand more about what you are talking about. I definitely didn't go bargain shopping with the ones you listed the other day. However, I'm now a much wiser shopper.
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