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Teddi KnightKeymaster
I am probably early but ….
Teddi KnightKeymasterNice idea! Might try it tomorrow if we get more of a drop.
August 11, 2015, 4:54 P.M. ET
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Apple: Moody’s Sees Hit from Yuan DevaluationBy Tiernan Ray
Moody’s Investors Service, the credit rating firm, this afternoon published a brief missive from its analyst Gerry Granovsky, stating that the sudden, unexpected devaluation by China of its currency, the yuan, could have a negative impact on Apple (AAPL).
According to Granovsky, prices will become higher in China, where pricing is in local currency, for Apple goods, while costs, denominated in U.S. dollars, will not decline:
The sudden devaluation of the Yuan is credit negative for technology companies with significant operations in China, such as Apple, which already have to cope with a strong US dollar. The devaluation further increases the cost of the iPhones and iPads in the local market. On the other hand, although much of Apple’s products are assembled in China, the company would not immediately see cost benefits from its Chinese sourcing because most of the manufacturing and assembly arrangements are denominated in US dollars. The devaluation is a mild credit positive for the electronics manufacturing companies, such as Flextronics International, Jabil Circuit and Sanmina, who have significant operations in China and stand to benefit from the lower input costs. But since these companies hedge their exposure to the Chinese currency, they won’t see the full effect of the devaluation in their quarterly financial statements. Plus, if the Yuan exchange rates remain depressed at the next contract renegotiation, the OEMs will look to recoup some of the cost savings that the electronics manufacturing companies earned due to the FX movement. Therefore, these types of currency movements tend to have very short term benefits for the contract manufacturers.
The analysis would seem to assume that Apple must raise prices in local currency to offset the decline of the yuan.
Jefferies & Co.’s Sundeep Bajikar today lowered his price target on Apple, warning of trouble from China.
Apple shares today fell $6.23, or 5%, to close at $113.49.
Teddi KnightKeymasterTeddy thank you, you are a lifesaver. I thought that I had a good thing going there for a bit! I am sure that I will never make that mistake again.
I was driving and read your reply (I was at a stop light :-) )and quickly pulled over and exited the trade. I sold the shares and bought the calls for a net gain of $16. So after commission I’ll make about $4. Thanks again Teddi for the explaination, I’m embarrassed :-/
Teddi KnightKeymasterTeddi, Earlier I did a JNJ trade with an expiration of 8/21 you had suggested some time back. Would you be comfortable entering a similar trade expiring Sept. 18 as well, or waiting?
Amy
Teddi KnightKeymasterSTO Jan15″16 strike 105 @ 7.00
will probably close early if can get a nice bounce in next few weeksTeddi KnightKeymasterSTO Aug 28 AAPL STRIKE $105 @ 1.00
Amy
Teddi KnightKeymasterI did another trade too
Bought 100 XOM shares @ $76.80
Sold 1 28AUG15 $75.00 call for $2.40
Time value premium remaining at $76.80 is $.60 which is less than the $.73 dividend. On this one I should earn $60.00 if the market cooperates.Teddi KnightKeymasterWell now the stock is $53.50 the idea of rolling down is not really possible, just want to get out with least loss as possible, like I said I have 500 61 puts and 500 62 puts that will expire Friday
Teddi KnightKeymasterJUST WONDERING WHAT TO DO NOW WITH MY 61 AND 62 PUTS. Take assignment and sell covered calls for the next ? months to try to break even or take loss and move on. I have about $59.85 share in stock now, will have to sell 56 calls to get any premium. :-(
Teddi KnightKeymasterMiss Teddi,
Thanks for the AAPL calls. Bought them @ .70 & sold them for 1.38. I was going to keep them another day but re-read the post about selling them when they double.
Teddi KnightKeymasterThank you for your thoughts Teddi. I would also watch for a pullback….not totally nuts yet!
Amy
Teddi KnightKeymasterTEDDI,
Would you consider adding a few more IWM at a strike of $120, or is it too early? That seemed to be the line in the sand that broke, and has now recovered.
Amy
Teddi KnightKeymasterHere is what Teddi did:
This year has been one of the best for the VIX Index Strategy as the market has gone up and down repeatedly and the VIX Index has followed along with it. On Friday I bought a total of 20 VIX Index Calls for Sept 16 expiry at the $14 call strike. I picked up a variety of prices including some for $1.95! My average is $2.00 for the calls. This sets up my VIX Index strategy to profit in August and by holding September calls I am better able to protect my capital from losses in the event that this August turns out a bit differently.
Teddi KnightKeymasterTeddi,
You ever buy VIX Puts?
JohnTeddi KnightKeymasterSTO AUG 14 STRIKE 117.5 @ .49
I am trying to slow down to spend more time away from the computer, build up my dividend stocks for long term reinvestment, but these trade calls have seemed awesome Teddi, and I never seem to get assigned the dividend stocks I want, so I am still following Ms. Teddi into the shark infested waters.
Hopefully next week this trade will pay for a years worth of membership! {or not}
AMY
Teddi KnightKeymasterclosed my INTC $28.50 @ .02, just in case. Got a decent premium for it.
Amy
Teddi KnightKeymasterCheck back in the trade alerts or articles…as I recall Teddi had $69.50 as her target.
Amy
Teddi KnightKeymasterHow to determine Walmart’s support levels (or any stock) after breaking nearly three years of support levels?
The price of Walmart is near a three year low. Do we look back to Feb 2013 ($68/$71) which looks like minor support or way back to Jun 2012 for support ($58/$68)?
Teddi KnightKeymasterIt’s a long time to August 28, so lots could happen. I might be wishing I had waited and bought it at $30, lol
Teddi KnightKeymasterI didn’t do the buy-write only because I have the $28.5 strike expiring tomorrow, and didn’t want to have an extra INTC trade to deal with. Hopefully it will expire, or I will close it for a few pennies, but nothing is certain.
Amy
Teddi KnightKeymasterI got $3.50 for the puts I sold, and of course there is no way to tell what oil will be doing by then. Just trying to stay even, not worried about the lost time value:)
Amy
Teddi KnightKeymasterTeddi – thanks for writing the post. Point 1 is clear that the sum of my strike price plus the premium received was less than the stock price hence the loss. However your second point, I could not understand. Can you state with numbers so that I can understand better.
Is it because the net you got was 0.22 c less than the dividend 0.24?Teddi KnightKeymasterLooks good-nice premium
Teddi KnightKeymasterWhat I did if anyone is interested, is wait for a bounce up towards $38 a few days ago, and rolled out to 9/18, strike $40.
Not sure if that will get me out….we’ll just see.
Amy
Teddi KnightKeymasterI have done 3 VIX trades, 2 with nice profits and 1 with a small loss. I now have a clear cut scaling out of a position and/or adjusting procedure in mind.
I would like to thank Teddi for all the great trading ideas and for having the absolutely best forum out there.
PS. I am hoping I can be more like an old wine that gets better with age LOL. -
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