San kalpa, earnings season day 2

General notes
Today, I will see how I can handle my first advanced trade. I was really unsure on how to get out of the trade that seems to turn to a winner, because of the fact that after hours RIMM got low to a hefty $136 (7% chute from where it was), thus my 2 Put contracts are in-the-money by $4. But I made a bit of googling through the maze and found some supportive notes:

a) Long Strangles can be either exited at the same time (provided that the volatility - or price movement - becomes violent enough to get the profit. I was making a quick run on the pricer and has found that theoretically the RIMM 155 Calls will be $.02 while the RIMM 140 Puts will be $5.5. Thus the total value of the position will be $5.52 against the $4.7 entry - which means a $.82 profit on the half of the position or roughly $160.

b) or the profitable position can be exited (with either target, manual or trailing stop exit) and the loosing position can be left open until the end of the trading time (max. days or weeks to be spent in the trade, that shall be decided on before entering the position). To profit from eventual market turns. In my case this will mean exiting the loosing position no later than 3 days prior expiry (17 April market close).

Watchlist additions & filtered candidates
Sunpower - SPWR
MACDV: COP, LUFK,

Trade session notes
First, I cancelled the stop losses for both positions (see reasoning in General Notes above).
9:50:23 A.M. The RIMM Apr Put trailing stop (tight, 5% down from $7.8) was triggered at $7.3 that brought me a 55% profit (not counting a few more bucks from the Call contracts, less the transaction costs). Put a 5% down trailing stop on the practically worthless Call contracts.
10:03:50 AM I have exited half of the BG Apr Put position @ $.85. And set a trailing stop on the rest (5% down from $.8).
10:28:59 AM The trailing stop was triggered at $.65.

Learning point from the BG trade, don't exit in two parts, if there is no clear uptrend. Especially, with a tight trailing stop on a tight range issue. Should I exit in one lot I would have saved $14.95 on the trade transaction cost at least.

2:40:41 PM Put an order for 3 contracts Long Strangle (May Call 55, May Put 50) for LRCX, that is supposed to report after the market close today. The stock was raising over the past two weeks and the suggested EPS for 2006 4Q is $1.06, while the same figure was $.6 a year before. from these I feel the stock a bit overvalued (=good news in the price already). Albeit I did not wanted to make it so risky, thus the May call instead of yesterday's April calls. Also, I wanted a straddle first, but figured it costs too much, and the bid ask for the legs were too big for my taste, thus I moved the upper leg a bit out-of-the-money. Will see tomorrow morning! The order was filled at $3.1 (combined).

Open positions at market close 11 April 2007:

Plain Vanillas

.BGPO

BG APR 75 Put

$77.00

$0.75

$0.00

Advanced plays - Long Strangle

.RFYDK	RIMM APR 155 Call	$146.02				$1.9		($60.00)
.RFYPH	RIMM APR 140 Put					$2.45		($10.00)