This week we are looking at another of the Investor’s Business Daily (IBD) Top 50 List companies.  We use this list in one of our option portfolios to spot outperforming stocks and place spreads that profit if the momentum continues, at least a little bit.  By the way, the 9 actual options portfolios we carry out at Terry’s Tips had a banner week again last week, with an average portfolio gain of 8.8%, 4 times the weekly gain for the market (SPY) gain of 2.2%.

Terry

Consider Interactive Brokers Group (IBKR) After Their Earnings Report

Interactive Brokers Group stock rallied to all-time highs shortly after their earnings report which was released earlier this month.  Analysts at Zack’s believe there is further upside and have recently published an article indicating Why Interactive Brokers Group Stock Might be a Great Pick.  Another article published on Motley Fool breaks down why Interactive Brokers is “building a sustainably profitable business heading into 2018.”

IBKR Chart January 2018

From a technical perspective, IBKR has taken out the 2017 high which was set in December at $62.33.  The level is now seen as strong downside support as it confluences with the lower line of a rising trend channel that originates from a low in November as well as the 20-period daily moving average.

IBD Underlying Updates January 25, 2018

*source Tradingview.com

If you agree there’s further upside ahead for Interactive Brokers, consider this trade which is a bet that the stock will continue to advance, at least a little, over the next seven weeks.

Buy To Open IBKR 16Mar18 60 Puts (IBKR180316P60)
Sell To Open IBKR 16Mar18 65 Puts (IBKR180316P65) for a credit of $1.83 (selling a vertical)

This price was $0.02 less than the mid-point of the option spread when IBKR was trading near $65.  Unless the stock rallies quickly from here, you should be able to get close to this amount.

If you use our favorite broker for this trade, tastyworks, your commission on this trade will only be $1 per opening contract ($2 per spread) (and there is no commission on closing trades, only the $.10 clearing fee).  Each contract would then yield $181 and your broker would charge a $500 maintenance fee, making your investment $319 ($500 – $181).  If IBKR closes at any price above $65 on March 18, both options would expire worthless, and your return on the spread would be 57% (450% annualized).

Changes to Investor’s Business Daily (IBD) Top 50 This Week:

We have found that the Investor’s Business Daily Top 50 List has been a reliable source of stocks that are likely to move higher in the short run.  Recent additions to the list might be particularly good choices for this strategy, and deletions might be good indicators for exiting a position that you might already have on that stock.

As with all investments, you should only make option trades with money that you can truly afford to lose.

Happy trading,

Terry

This week we are looking at another of the Investor’s Business Daily (IBD) Top 50 List companies.  We use this list in one of our portfolios to spot outperforming stocks and place spreads that take advantage of the momentum. We selected this same company six weeks ago, and the spread we placed at that time will have gained 60% by next Friday if the stock ends up above $123 at that time (it is about $126 right now).

Terry

Red Hat (RHT) is Set To Extend the Momentum

Red hat stock saw some strong gains in 2017 and several analysts believe there is further upside ahead including BMO Capital Markets who have raised their targets to $142.00 and Wells Fargo & Co who are looking for a rise to $144.00.

From a technical perspective, RHT has been consolidating sideways for a few months.  A confluence of support from a rising trendline dating back to a low posted in June and a horizontal level at $120.00 recently triggered a turn higher which has resulted in the stock price climbing back above its 50-period daily moving average.  The $130 handle may present a hurdle but a break of the level is likely to accompany a renewal of upside momentum.

RHT Chart January 2018

*source Tradingview.com

If you agree there’s further upside ahead for Red Hat, consider this trade which is a bet that the stock will continue to advance, or at least not decline very much over the next four weeks.

Buy To Open RHT 16Feb18 120 Puts (RHT180216P120)
Sell To Open RHT 16Feb18 125 Puts (RHT180216P125) for a credit of $1.83 (selling a vertical)

This price was $0.02 less than the mid-point of the option spread when RHT was trading near $126.  Unless the stock rallies quickly from here, you should be able to get close to this amount.

If you use our favorite broker for this trade, tastyworks, your commission on this trade will only be $1 per opening contract ($2 per spread) (and there is no commission on closing trades, only the $.10 clearing fee).  Each contract would then yield $181 and your broker would charge a $500 maintenance fee, making your investment $319 ($500 – $181).  If RHT closes at any price above $125 on February 16, both options would expire worthless, and your return on the spread would be 57% (647% annualized).

Changes to Investor’s Business Daily (IBD) Top 50 This Week:

IBD Underlying Updates January 18, 2018

We have found that the Investor’s Business Daily Top 50 List has been a reliable source of stocks that are likely to move higher in the short run.  Recent additions to the list might be particularly good choices for this strategy, and deletions might be good indicators for exiting a position that you might already have on that stock.

As with all investments, you should only make option trades with money that you can truly afford to lose.

Happy trading,

Terry

This week we are looking at another of the Investor’s Business Daily (IBD) Top 50 List companies.  We use this list in one of our portfolios to spot outperforming stocks and place spreads that take advantage of the momentum.  The Terry’s Tips actual portfolio that executes these trades has gained 26% in the first two weeks of 2018 and is our third-best performing portfolio so far in this new year.

Terry

Wingstop (WING) Rallies on Earnings Forecast, Can It Continue the Momentum?

Wingstop shares have already made an impressive gain in the first few weeks of the new year and several analysts believe there is further upside ahead.  CNBC has published an article outlining the factors driving the recent rally while Wingstop CEO Charlie Morrison shares his outlook for growth in a video interview with Jim Cramer.

Wingstop stock closed at a record high in the past week after taking out notable horizontal resistance around $43 which was also last year’s high.  The horizontal level is now seen as downside support and several retests of the level following the technical break have been met with buyers.

WING Chart January 2018

*source Tradingview.com

If you agree there’s further upside ahead for Wingstop, consider this trade which is a bet that the stock will continue to advance, or at least not decline very much over the next five weeks.

Buy To Open WING 16Feb18 40 Puts (WING180216P40)
Sell To Open WING 16Feb18 45 Puts (WING180216P45) for a credit of $1.28 (selling a vertical)

This price was $0.02 less than the mid-point of the option spread when WING was trading near $45.  Unless the stock rallies quickly from here, you should be able to get close to this amount.

If you use our favorite broker for this trade, tastyworks, your commission on this trade will only be $1 per opening contract ($2 per spread) (and there is no commission on closing trades, only the $.10 clearing fee).  Each contract would then yield $126 and your broker would charge a $500 maintenance fee, making your investment $374 ($500 – $126).  If WING closes at any price above $45 on February 18, both options would expire worthless, and your return on the spread would be 34% (384% annualized).

Changes to Investor’s Business Daily (IBD) Top 50 This Week:

IBD Underlying Updates January 11, 2018

We have found that the Investor’s Business Daily Top 50 List has been a reliable source of stocks that are likely to move higher in the short run.  Recent additions to the list might be particularly good choices for this strategy, and deletions might be good indicators for exiting a position that you might already have on that stock.

As with all investments, you should only make option trades with money that you can truly afford to lose.

Happy trading,

Terry

Greetings, Terry’s Tips subscriber!

One of our best relationships over the course of 2017 has been with the guys that created thinkorswim. They have now moved on from that experience to introduce to us the newest kid on the brokerage block: tastyworks! If you ask us, we think their commission structure is absolutely the best one around, especially if you are a heavy options trader like we are. We love the things they are doing and don’t want you to miss out. Read on to see the message they sent to their tastyworks and tastytrade friends.

It’s time to join their nation!

Terry

“Hello, tastynation!

To start off 2018 just right, we want to thank you for your show of unconditional support and irreplaceable loyalty for tastytrade and tastyworks. You are the reason we’re driving change to the financial industry. We’ve not only planned more of what you love, like more live tastytrade shows in 25 cities, more trading tools, more mind-blowing content, more new daily shows – but also stuff that will leave you thinking, “How’d they do THAT?”

tastyworks introduced zero commissions to close trades on Jan 3rd, 2017. Starting tomorrow, on Jan 2nd, 2018, tastyworks is introducing capped commissions for large option trades. This means the most commission you will pay for any single leg option trade is $10* (plus clearing fees). That’s right, just $10* per leg!

Eighteen years ago, when we built thinkorswim, 100 option contracts to open and close was $300+. At the time, we thought $1.50 per contract was cheap. Today, the industry average per contract is about $.70 plus a small ticket charge. So, 100 option contracts today is approximately $150 to open and close at most firms. With tastyworks’ new rate schedule, the same trade will cost $10 in commissions to open, zero in commissions to close and a $20 clearing fee for a total of $30. Compare that rate to any other firm on the planet and remember how good our technology and content is as well. Fees for small options trades (10 contracts or less) stay the same.

But we’re not done. As an added bonus, tastyworks will have twelve monthly drawings for funded accounts (minimum of $2,000) and each month, one customer will win free commissions for 5 years. And no, we haven’t lost our minds. We simply want to do something special and this is just the start.

On the technology side, tastyworks is releasing a new analysis tab, portfolio margin, options on futures, paper trading, an open API, a new scripting language and lots of new mobile features.

So thank you again for the incredible engagement over the past year. You have helped to make tastytrade and tastyworks one of America’s fastest growing financial innovators.

Scott / Woody & the tastyworks team
Kristi / Tom & the tastytrade team

**The only exclusions are futures options and a few cash-settled indices. Clearing, regulatory and exchange fees still apply. See website for full details. Clearing fees are $.10 per contract. tastyworks does not have ticket charges, monthly minimums, platform fees, data fees, cancel fees, excess risk fees or fees for access to live trade desk support.”

tastytrade content is provided solely by tastytrade, Inc. (“tastytrade”) and is for informational and educational purposes only. It is not, nor is it intended to be, trading or investment advice or a recommendation that any security, futures contract, transaction or investment strategy is suitable for any person. Trading securities can involve high risk and the loss of any funds invested. tastytrade, through its content, financial programming or otherwise, does not provide investment or financial advice or make investment recommendations. Investment information provided may not be appropriate for all investors, and is provided without respect to individual investor financial sophistication, financial situation, investing time horizon or risk tolerance. tastytrade is not in the business of transacting securities trades, nor does it direct client commodity accounts or give commodity trading advice tailored to any particular client’s situation or investment objectives. tastytrade is not a licensed financial advisor, registered investment advisor, or a registered broker-dealer.

tastyworks, Inc. (“tastyworks”) is a registered broker-dealer and member of FINRA, NFA, and SIPC. tastyworks is a wholly owned subsidiary of tastytrade, Inc. (“tastytrade”). tastyworks and tastytrade are separate but affiliated companies that are not responsible for each other’s products, services or policies. Options are not suitable for all investors as the special risks inherent to options trading may expose investors to potentially rapid and substantial losses. Please read Characteristics and Risks of Standardized Options before investing in options. Options trading is subject to tastyworks account review and approval.

tastyworks, Inc. (“tastyworks”) has entered into a Market Agreement with [Insert Agent] (“Marketing Agent”) whereby tastyworks pays compensation to Marketing Agent to recommend tastyworks’ brokerage services. The existence of this Marketing Agreement should not be deemed as an endorsement or recommendation of Marketing Agent by tastyworks and/or any of its affiliated companies. Neither tastyworks nor any of its affiliated companies is responsible for the privacy practices of Marketing Agent, its website or this email. tastyworks does not warrant the accuracy or content of the products or services offered by Marketing Agent, its website, or this email.

This week we are looking at another of the Investor’s Business Daily (IBD) Top 50 List companies.  We use this list in one of our portfolios to spot outperforming stocks and place spreads that take advantage of the momentum. Speaking of our portfolios, I would like to share with you the exact report for 2017 that we sent to Terry’s Tips’ paying subscribers this week – “All of the portfolios except Boomers’ Revenge and Vista Valley have been reset for 2018. Boomers’ Revenge will start over with $5000 after the 1/19/18 spreads expire with an almost-certain gain of 56% for the “year” starting and ending on the third Friday of January.  The others:

• Capstone Cascade – (restarted with $10,000 on 1/2/18) – 48% gain for 2017
• Contango (our only portfolio not available for Auto-Trade – restarted with $5000 on 1/2/18) – 138% gain for 2017
• Earnings Eagle (started with $5000 on 6/7/17) – 31% gain over last 6 months of 2017
• Galloping Turtle (restarted with new strategy on 11/20/17 after withdrawal of $3960) –  79% gain for 2017
• Honey Badger (restarted with $5000 using a new strategy on 12/26/17) – 48% loss for 2017, our only losing portfolio (fully recovered loss in the first week of 2018)
• Leaping Leopard (restarted on 12/26/17 with $5000 after withdrawal of $2001) – 40% gain for 2017
• Rising Tide (restarted on 1/2/18 with $5000 after withdrawal of $7615) – 152% gain for 2017
• Vista Valley (restarted on 1/19/18 with $5000 after withdrawal of $5058) – 101% gain for 2017

• Wiley Wolf (restarted on 11/8/17 with $5000 after $19,840 withdrawal) – 728% gain for 2017 as FB soared 56%.”

Terry

Adobe Systems (ADBE): Q4 Earnings Beat to Fuel Further Momentum

Two recent analyst upgrades suggest there is potential for a 10% upside in Adobe Systems stock price as BMO Capital Markets have recently raised their price targets to $205 and BofA have set a target of $220.

The technical outlook for ADBE is encouraging.  The stock posted a steady rally throughout 2017 for an annual gain of roughly 70%.  ADBE corrected lower in late November but bounced back after a test of horizontal support at 165.50 from a prior gap.  It has since recovered back above the 50-period daily moving average and is on the verge of breaking to new highs, suggesting the uptrend has resumed.

ADBE Chart January 2018

*source Tradingview.com

If you agree there’s further upside ahead for Adobe Systems, consider this trade which is a bet that the stock will continue to advance, or at least not decline very much over the next six weeks.

Buy To Open ADBE 16Feb18 180 Puts (ADBE180216P180)
Sell To Open ADBE 16Feb18 185 Puts (ADBE180216P185) for a credit of $1.85 (selling a vertical)

This price was $0.02 less than the mid-point of the option spread when ADBE was trading near $185.  Unless the stock rallies quickly from here, you should be able to get close to this amount.

If you use our favorite broker for this trade, tastyworks, your commission on this trade will only be $1 per opening contract ($2 per spread) (and there is no commission on closing trades, only the $.10 clearing fee).  Each contract would then yield $183 and your broker would charge a $500 maintenance fee, making your investment $317 ($500 – $183).  If ADBE closes at any price above $185 on February 18, both options would expire worthless, and your return on the spread would be 58% (540% annualized).

Changes to Investor’s Business Daily (IBD) Top 50 This Week:

IBD Underlying Updates January 4, 2018

We have found that the Investor’s Business Daily Top 50 List has been a reliable source of stocks that are likely to move higher in the short run.  Recent additions to the list might be particularly good choices for this strategy, and deletions might be good indicators for exiting a position that you might already have on that stock.

As with all investments, you should only make option trades with money that you can truly afford to lose.

Happy trading,

Terry

This week we are looking at another of the Investor’s Business Daily (IBD) Top 50 List companies.  We use this list in one of our portfolios to spot outperforming stocks and place spreads that take advantage of the momentum.  The 2017 trading year is over.  The 10 option portfolios carried out at Terry’s Tips gained an average of 113% for the year.  Only one portfolio lost money, and four of them earned over 100%.  It was the best year in our 16-year history.  We look forward to a similar outcome in 2018.  We invite you to come along for the ride.

Terry

Fleetcor Technologies (FLT) Likely to Cross $200 Mark

Two recent analyst upgrades suggest Fleetcor Technologies stock will cross the $200 point as Deutsche Bank has raised their price targets to $225 and Jefferies has raised their target to $218.

FLT posted a sixth consecutive week of gains in the past week and closed at an all-time record high.  In fact, the stock has only had three down weeks in the last 19 and each one of those declines was not very significant.  A rising trendline is in play that originates from a low posted in September and offers support near the $190 price point where the 20-period daily moving average is also found to add confluence.

FLT Chart January 2018

*source Tradingview.com

If you agree there’s further upside ahead for Fleetcor Technologies, consider this trade which is a bet that the stock will continue to advance, or at least not decline very much over the next seven weeks.

Buy To Open FLT 16Feb18 185 Puts (FLT180216P185)
Sell To Open FLT 16Feb18 190 Puts (FLT180216P190) for a credit of $1.78 (selling a vertical)

This price was $0.02 less than the mid-point of the option spread when FLT was trading near $192.  Unless the stock rallies quickly from here, you should be able to get close to this amount.

If you use our favorite broker for this trade, tastyworks, your commission on this trade will only be $1 per opening contract ($2 per spread) (and there is no commission on closing trades, only the $.10 clearing fee).  Each contract would then yield $176 and your broker would charge a $500 maintenance fee, making your investment $324 ($500 – $176).  If FLT closes at any price above $190 on February 16, 2018, both options would expire worthless, and your return on the spread would be 54% (431% annualized).

Changes to Investor’s Business Daily (IBD) Top 50 This Week:

IBD Underlying Updates December 28, 2017

We have found that the Investor’s Business Daily Top 50 List has been a reliable source of stocks that are likely to move higher in the short run.  Recent additions to the list might be particularly good choices for this strategy, and deletions might be good indicators for exiting a position that you might already have on that stock.

As with all investments, you should only make option trades with money that you can truly afford to lose.

Happy trading,

Terry