He had it coming.
But this isn’t really about Philip and his cancer sticks.
Instead, I’m going to sell premium in his Philip Morris stock options, betting on the company going nowhere for at least the next month.
First up, look at this chart:
We can clearly see the range contracting all year in $PM. Given what the broader stock market is doing, my bet is this range contraction continues.
Now the wrinkle we have to deal with is that Philip Morris is slated to release their next quarterly earnings statement on October 19, which is ONE DAY before October monthly options expire! That makes it tricky to be selling premium in the regular monthly options.
But the good news is, we can select the October 13 WEEKLY expiration options to express our trade.
Here’s the Play: [Read more…]