Hedge Play for Friday 5/19/2006 Earnings(ASEI)
buy the may 80 calls at .50 and buy the may 60 puts at .35.
ASEI has been a huge short target. AFter reaching a yearly high of 93 plus stock has been acting horribly. Technically its broke. Next support is 60, after that no support until 40.
That being said earning coming out Friday morning. DAy of options experation. For a company who has had a track record of beating earnings by upwards of almost a 100%, this could swing this stock up or down severely.
I would definitely look to hedge this stock on the short and long.
Big miss stock crashes below 60. Big surprise to upside stock could test 52 week high of 93 plus.
Bottomline risk to reward looks great. More conservative hedge would be the may 70 calls and puts..
ASEI currently trades at 69.78
ASEI has been a huge short target. AFter reaching a yearly high of 93 plus stock has been acting horribly. Technically its broke. Next support is 60, after that no support until 40.
That being said earning coming out Friday morning. DAy of options experation. For a company who has had a track record of beating earnings by upwards of almost a 100%, this could swing this stock up or down severely.
I would definitely look to hedge this stock on the short and long.
Big miss stock crashes below 60. Big surprise to upside stock could test 52 week high of 93 plus.
Bottomline risk to reward looks great. More conservative hedge would be the may 70 calls and puts..
ASEI currently trades at 69.78
posted by JV at 9:49 AM
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