Continuing with our outlook for the week ahead in our Freaky Fast Folio, we get to Data Dog. DDOG is another of the top leading software companies. We’ve only been in this for a few days, but we do have over 5% profit. The big dog reports earnings after the close, Thursday.
The chart is excellent, of course. But I’m a little torn on this one. The stock has a nice Composite Rating of 96 at Investor’s Business Daily, but is rated as just the 17th best of the software companies, behind names like Docusign, Service Now, Coupa and Dynatrace. I just held Dynatrace through earnings last week and sold it a couple days later because the price action put me to sleep. But at least it didn’t collapse. And DDOG
has shown the ability for accelerated growth in the past. I’ll probably decide to sell half of this into earnings and let the rest ride.
Draftkings (DKNG) might be my favorite company in the world right now. I have a soft spot for sports gambling, and believe the American market for their services will only grow stronger as time goes by and more states legalize it. Unfortunately, that soft spot has caused me to ignore my trading rules, and I’m currently down about twice what I should ever allow myself to lose in a position. So after riding this originally from $25 to $44, I’ve given most of my profits back.
That is not pretty. It needs to hold above $32 or I’m out. But I guarantee I’ll be back when the time is right again.
The yellow metal (GLD) is on fire. I played this one through the options market, and unfortunately I played it too cautiously. Don’t get me wrong, I paid $153 to buy the Sept $175 call and sell the Aug $181… and now it’s worth $600. So that’s good. And there’s another $200 to be made if it can somehow make it’s way back near $181. This is what the earnings graph looks like. The blue line is profit or loss at August 21s expiration. The purpley one is profit or loss if sold today.
But this chart is absurd, wish I had seen the extent it was going to run.
I will be holding as long as it stays above $180. But I certainly wouldn’t be buying here.
F is for Ford. It just announced earnings and the stock fell some, despite what I felt was a better than expected performance. I own this through 3 of the December $7 calls. We have a grand total profit of $15 on this puppy, but we have also made another $40 selling calls against that position, so that’s a $55 profit on a $186 investment. Not too shabby.
F is also the grade you’d give this stock chart, and it makes you wonder why the F someone like me was ever in this trade to begin with. Hopelessly optimistic, I guess. I’ll probably sell a weekly $6.5 call against the position Monday morning. I’ll be out of the position on a break of the 50-day moving average (blue), or $6.35.
We got in my old friend JD on Friday. I bought this specifically to hold through earnings on the 13th, and I used options. We’re long the Sept $70 call and short the August $72 call for a total of $122, which is the maximum loss.
A friend of mine played it long the September $70 call and short the August $75 call, at a cost of $148. This is what his profit potential looks like.
Honestly, I like his potential a lot more. But with the one I did, you’re looking to land in that sweet spot between $69 and $77 for a profit of anywhere from $200 to $350. The chart below led me to those expectations.
I’ll be back with more from our Folio later. Questions or comments are welcome below.