#11
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Re: stock props at bodog
max total bet is 150, i already had 65 on it from before. it only let bet 85.
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#12
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Re: stock props at bodog
ah ok
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#13
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Re: stock props at bodog
FWIW, analyst price targets from finance.yahoo.com:
PRICE TARGET SUMMARY Mean Target: 90.36 Median Target: 90.00 High Target: 100.00 Low Target: 74.00 No. of Brokers: 22 Looks like the "high target" is only $100. Further support for this bet being "free money." |
#14
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Re: stock props at bodog
-400 now, $200 max bet. I put another $50 on it. What line would you say offers no value anymore?
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#15
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Re: stock props at bodog
i'm no stock expert, but you don't have to be to recognize the value at -130 or -300. i'd guess the value ends around -800, but i wouldn't bet it past -600 myself.
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#16
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Re: stock props at bodog
-600 now.
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#17
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Re: stock props at bodog
[ QUOTE ]
AAPL's implied vol in the options marketplace right now is less than 40 40% * $90 * sqrt (25 trading days / 250 trading days) = $11.4 [/ QUOTE ] You need to count calendar days, not trading days. In this case the number of days between now and December 29th, the last trading day of 2006. All options pricing models use calendar days because you pay interest on weekends. Also, things can happen on weekends even with the markets closed. Probably won't throw off your calculations much. |
#18
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Re: stock props at bodog
[ QUOTE ]
I think the most comparable options trade to this prop bet would be selling calls, which is basically selling someone else the right to buy a stock from you at a given price at a future date. [/ QUOTE ] Not really a good analogy because your risk is unlimited when writing (selling) options. You have defined risk in this case, like when you purchase an option. But your reward is also defined and limited, so it differs from buying an option. [ QUOTE ] The current market price of the Dec 06 $540 GOOG calls is $3.70. To "win" $50, you would have to sell 14 of them (14 * $3.70 = $51.80). [/ QUOTE ] That's $3.70 per share and the standard options contract is 100 shares, so each call is $370, not $3.70. |
#19
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Re: stock props at bodog
[ QUOTE ]
[ QUOTE ] AAPL's implied vol in the options marketplace right now is less than 40 40% * $90 * sqrt (25 trading days / 250 trading days) = $11.4 [/ QUOTE ] You need to count calendar days, not trading days. In this case the number of days between now and December 29th, the last trading day of 2006. All options pricing models use calendar days because you pay interest on weekends. Also, things can happen on weekends even with the markets closed. Probably won't throw off your calculations much. [/ QUOTE ] Stock prices can't move on days that they don't trade. Therefore they cannot have implied volatility. There may be circles that do it otherwise, but every options pricing class I've been in (working on Wall St) has used trading days for vol and calendar days for interest. |
#20
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Re: stock props at bodog
BTW: -800 now.
Still has some value according to my original analysis (could always buy a 110 call to hedge for $5) but more of a cliff-jumper now if you buy it naked. Should I lock in my 1-day, 400c arb? [img]/images/graemlins/wink.gif[/img] |
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