MCM FEBRUARY EXPIRATION DISPOSITION OF OPEN POSITIONS.
POSITIONS THAT SHOULD PRESENT NO PROBLEMS TOMORROW.
On the PUT side: SINA, MOS, RIMM (puts), CREE (puts), CMI (puts)
should all EXPIRE TOMORROW with SINA and MOS more than 10-12 points out of the money. All these positions should
easily expire worthless tomorrow.
Additionally, the CMI (calls) should also expire worthless tomorrow as well.
There is really no issue to be concerned with on the put side for tomorrow's expiration.
POSITIONS TO WATCH FOR TOMORROW ON THE CALL SIDE.
NEM - is still out of the money by $1.04, and should be okay, unless we get a big surprise inflation
annoucement and gold prices take off, this position should expire worthless. However, as with any position
in case "Murphy's Law" should visit, be prepared at least to close out this position if the NEM FEB 60 looks
to close above 60 and in the money. If it does not, nothing need be done.
INFY - is still $0.44 out of the money, but will need some watching, similiar to that of NEM above.
Similiar to NEM, nothing needs to be done unless the short INFY 70 Call looks to close in the money at the
end of the day.
POSITIONS THAT WILL PROBABLY NEED ACTION TOMORROW.
BJ - is in the money by $1.97. We are looking to close out the BJ short $47.50 for
a limit price of $1.70 - $1.80 tomorrow. You also could take the option of waiting to see how the
market trades during the day and seeing if you can get a better price, or holding the position and closing out
the short BJ $47.50 short call with a MARKET on CLOSE order at the end of the day.
Regardless, the BJ short $47.50 call has
to be closed out unless BJ looks to close below $47.50, which is highly unlikely tomorrow.
Bottom line: BJ must be closed tomorrow with any of the three (3) optional choices above
CREE - closed today at $55.32, $0.32 in the money against out FEB 55 short call.
There are several ways to handle the CREE short call position.
First you can choice to close it out using a BUY STOP limit of $.70 or wait, as I usually do, to see how the
stock opens tomorrow and decide to close it out for a slightly lower price tomorrow if the
stock opens down or maybe a slightly higher price if the stock opens up today. The final
alternative is to wait out the day and close the position, if it looks to close in the money
with a MARKET ON CLOSE order, as I normally do.
Remember, there is still a chance for this stock to close
less then $55 tomorrow and in that scenario the CREE 55 call would expire worthless.
But remember, as with any issue if it looks to close in the money on the call side, you will
be exercised and be forced to deliver stock that you probably do not own. Remember, even
a $0.01 in the money will result in an exercise or assignment of stock either to you ( if a put)
or from you ( if a short call ).
Finally, if Murphy's law should arrive tomorrow, remember ANY stock option that is in the money
must be closed out before the market close tomorrow.
REMINDER: The March watch list and portfolio positions will begin tomorrow after the February
positions come off the board. In addition, we will be adding several more positions to our MARCH
recommended list over the weekend.