Stocks vs. Options: Which generates better returns?
Plug in your stock idea to find options trades offering a potentially better ROI.
NEW TO OPTIONS?
Visit our New to Options page to learn more.
Find out more »
February 8, 2010 8:32 EST Related Symbols: QCOM
you're watching:
Mad About Options
An options-related take on Jim Cramer's latest recommendations and analysis on the latest securities and ETFs getting attention on the Street.
Find out important news for option traders on Qualcomm, and potential option strategies.
The Pick – Qualcomm Inc. (NASDAQ: QCOM):
On Jan. 27, QCOM announced earnings of 62 cents a share, which beat estimates of 56 cents EPS. Since then, the stock has dropped nearly 20% from $47.20 to $38.20. QCOM was also one of Cramer’s top tech picks.
BULLISH Option Trading Idea for QCOM:
Bull put spreads –
Maximum risk: $14 plus commissions
Maximum potential profit: $6 minus commissions
Breakeven: The strategy will be profitable if QCOM shares are trading higher than $37 at April expiration.
BEARISH Option Trading Idea for QCOM:
Collar–
Maximum risk: $40 plus commissions
Maximum potential profit: $35 minus commissions
Breakeven: The strategy will be profitable if QCOM shares are trading lower than $40 at January 2011 expiration.
For more trading ideas and breaking news on the options market, stay tuned in to The Options News Network.
