The CEO of AAPL says that phone sales are accelerating in China. The low range yesterday was a mark of $92, now $109. Now very few people got to pickup AAPL at $92, however the market flux gave us some great opportunities. One of the things that influenced the price of options was the demand to protect their portfolio (beware) for you are paying the high prices for protecting yourself when the masses are headed for the door. This is why we suggest that you learn to naturally hedge your portfolio on a regular basis. One of the trades we put on yesterday was a purchase of the SPY at $192.63 and sold the 192 call option for $4.25. This gave us some downside protection and upside as well. You would think the option would have increased in value with the SPY trading above $194 but it was not. The reason is the price flux yesterday caused the prices to be difficult for the option creators. We were able to close the calls today with a profit and lighten our load in SPY with a profit on that position as well. Another trade we put on yesterday was selling the AAPL puts, as we expected AAPL to rebound with statements from the CEO that sales were accelerating. This move was also a winner.
We continue to believe that AAPL is a long term buy and selling calls against any new position makes sense, and mixing up your buying on weakness is a good move.
As always, consult your advisor before investing of any kind. Options are nOT suitable for all investors and people can and do lose money.