[at-l] I wonder...

[Tom McGinnis]

--- On Fri, 3/20/09, Felix J <AThiker at smithville.net> wrote:

> I wonder what's happened today that made FedEx stock drop $2.50.  
> Probably announced a profit of some sort...  ;-)))))

### (This guy's a real card!)

Dunno wut's up wit' FDX, but the majority of a stock's movement is in following the movement of the overall market -- part two of that "compared to what?" proposition from yesterday. After a couple of major gains, and a couple of flat days, demand has simmered back and supply has bid down the overall market.

Now, re FDX -- the April $40 calls are running $3.85, while FDX is at ~$42.
You could (were you a buy-n-hold kind of guy) buy 100 shares of FDX while selling 1 call contract @ $3.85 -- taking your basis to $38.15. If FDX closes at 40 bucks or higher in April (the 17th), you get 40 bucks per share, for a profit of $1.85 *100. If FDX closes at $39.99 or below, you write another call contract -- right now the Julys are going for $6.20 for the $40, and $9.25 for the next strike price down ($35.) That's some wicked return -- buy it at 
$42 today, and if your not called out (to +$185) in April, you write July too, at 6.20, taking your basis from $38.15 to $31.95. If you're called out at $40 in July, you are ahead roughly $800. If the stock's dropped below $40, you write October calls, and take your basis down again.

But hey.
It's just money. And money equals time. Hiking takes time and money, or money². Now, since money is √Evil, and hiking = money², then

hiking = money*time = money² = (√Evil)² = Evil.


Now that I've ruined your day, let me point out that this post is now hiking related. AND evil. Sheesh.