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AnalyticalVega
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Joined: January 16th, 2013, 5:03 am

Long AAPL / Short GOOG Trade

October 22nd, 2013, 2:14 pm

Long AAPL P/E - 12.93 Stock off All Time High of 680, now trading around 520Short GOOG P/E- 28.85 stock at All Time HighsA calendar strategy seems reasonableCall Spread for AAPL, Put Spread for GOOGComments?
 
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daveangel
Posts: 17031
Joined: October 20th, 2003, 4:05 pm

Long AAPL / Short GOOG Trade

October 22nd, 2013, 3:40 pm

apples and oranges dear boy
knowledge comes, wisdom lingers
 
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AnalyticalVega
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Posts: 2260
Joined: January 16th, 2013, 5:03 am

Long AAPL / Short GOOG Trade

October 22nd, 2013, 4:22 pm

QuoteOriginally posted by: daveangelapples and oranges dear boynot completely, they are both tech companies and they compete with some products such as smartphones
 
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Traden4Alpha
Posts: 23951
Joined: September 20th, 2002, 8:30 pm

Long AAPL / Short GOOG Trade

October 22nd, 2013, 7:59 pm

QuoteOriginally posted by: AnalyticalVegaQuoteOriginally posted by: daveangelapples and oranges dear boynot completely, they are both tech companies and they compete with some products such as smartphonesHmmmm... Daveangel is right. Apple mostly sells hardware and Google mostly sells advertising. Google's Android may compete with Apple's iOS, but Google's revenues and profits are barely affected by Android adoption and Google's control of Android is tenuous at best. Apple and Google are tech companies in the same way that Boeing and Air France are in the transportation industry.Maybe Apple vs. Samsung might be better?
 
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AnalyticalVega
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Posts: 2260
Joined: January 16th, 2013, 5:03 am

Long AAPL / Short GOOG Trade

October 22nd, 2013, 9:08 pm

QuoteOriginally posted by: Traden4AlphaQuoteOriginally posted by: AnalyticalVegaQuoteOriginally posted by: daveangelapples and oranges dear boynot completely, they are both tech companies and they compete with some products such as smartphonesHmmmm... Daveangel is right. Apple mostly sells hardware and Google mostly sells advertising. Google's Android may compete with Apple's iOS, but Google's revenues and profits are barely affected by Android adoption and Google's control of Android is tenuous at best. Apple and Google are tech companies in the same way that Boeing and Air France are in the transportation industry.Maybe Apple vs. Samsung might be better?There are other reasons for this trade valuations is one of them.
 
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Traden4Alpha
Posts: 23951
Joined: September 20th, 2002, 8:30 pm

Long AAPL / Short GOOG Trade

October 22nd, 2013, 9:20 pm

QuoteOriginally posted by: AnalyticalVegaQuoteOriginally posted by: Traden4AlphaQuoteOriginally posted by: AnalyticalVegaQuoteOriginally posted by: daveangelapples and oranges dear boynot completely, they are both tech companies and they compete with some products such as smartphonesHmmmm... Daveangel is right. Apple mostly sells hardware and Google mostly sells advertising. Google's Android may compete with Apple's iOS, but Google's revenues and profits are barely affected by Android adoption and Google's control of Android is tenuous at best. Apple and Google are tech companies in the same way that Boeing and Air France are in the transportation industry.Maybe Apple vs. Samsung might be better?There are other reasons for this trade valuations is one of them.Yet the core assumption is that AAPL and GOOG are correlated (and should revert together) or maybe that GOOG hedges out some categories of uncertainties in AAPL's future price movement. But neither the revenues nor the profits of the two companies seem especially linked.
 
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Alan
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Long AAPL / Short GOOG Trade

October 22nd, 2013, 10:53 pm

QuoteOriginally posted by: AnalyticalVegaLong AAPL P/E - 12.93 Stock off All Time High of 680, now trading around 520Short GOOG P/E- 28.85 stock at All Time HighsA calendar strategy seems reasonableCall Spread for AAPL, Put Spread for GOOGComments?My comment is that GOOG already reported earnings this season and AAPL hasn't.A calendar strategy at this point seems more a bet on the magnitude of the jump fromupcoming AAPL earnings release vs AAPL implied vols, and also little to do with GOOG. Given your outlook, bullish vs. bearish vertical spreads seem to make more sense to me.
Last edited by Alan on October 22nd, 2013, 10:00 pm, edited 1 time in total.
 
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daveangel
Posts: 17031
Joined: October 20th, 2003, 4:05 pm

Long AAPL / Short GOOG Trade

October 23rd, 2013, 7:05 am

QuoteOriginally posted by: AnalyticalVegaQuoteOriginally posted by: Traden4AlphaQuoteOriginally posted by: AnalyticalVegaQuoteOriginally posted by: daveangelapples and oranges dear boynot completely, they are both tech companies and they compete with some products such as smartphonesHmmmm... Daveangel is right. Apple mostly sells hardware and Google mostly sells advertising. Google's Android may compete with Apple's iOS, but Google's revenues and profits are barely affected by Android adoption and Google's control of Android is tenuous at best. Apple and Google are tech companies in the same way that Boeing and Air France are in the transportation industry.Maybe Apple vs. Samsung might be better?There are other reasons for this trade valuations is one of them.my views on this:1. if you think AAPL is cheap, buy it. 2. if you think GOOG is dear then try shorting it but you need a catalyst - shorting "valuations" is a well travelled road to hell.3. Don't create a pairs trade for no reason.
knowledge comes, wisdom lingers
 
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AnalyticalVega
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Joined: January 16th, 2013, 5:03 am

Long AAPL / Short GOOG Trade

October 23rd, 2013, 3:55 pm

QuoteOriginally posted by: daveangelQuoteOriginally posted by: AnalyticalVegaQuoteOriginally posted by: Traden4AlphaQuoteOriginally posted by: AnalyticalVegaQuoteOriginally posted by: daveangelapples and oranges dear boynot completely, they are both tech companies and they compete with some products such as smartphonesHmmmm... Daveangel is right. Apple mostly sells hardware and Google mostly sells advertising. Google's Android may compete with Apple's iOS, but Google's revenues and profits are barely affected by Android adoption and Google's control of Android is tenuous at best. Apple and Google are tech companies in the same way that Boeing and Air France are in the transportation industry.Maybe Apple vs. Samsung might be better?There are other reasons for this trade valuations is one of them.my views on this:1. if you think AAPL is cheap, buy it. 2. if you think GOOG is dear then try shorting it but you need a catalyst - shorting "valuations" is a well travelled road to hell.3. Don't create a pairs trade for no reason.These 3 comments I can agree with.
 
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AnalyticalVega
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Joined: January 16th, 2013, 5:03 am

Long AAPL / Short GOOG Trade

October 23rd, 2013, 4:07 pm

QuoteOriginally posted by: AlanQuoteOriginally posted by: AnalyticalVegaLong AAPL P/E - 12.93 Stock off All Time High of 680, now trading around 520Short GOOG P/E- 28.85 stock at All Time HighsA calendar strategy seems reasonableCall Spread for AAPL, Put Spread for GOOGComments?My comment is that GOOG already reported earnings this season and AAPL hasn't.A calendar strategy at this point seems more a bet on the magnitude of the jump fromupcoming AAPL earnings release vs AAPL implied vols, and also little to do with GOOG. Given your outlook, bullish vs. bearish vertical spreads seem to make more sense to me.hmm...vertical spreads? but then most of the vega would be hedged out. I would then need to change my name to AnalyticalDelta or something Seriously I like to be long vega generally, but with AAPL in the 54% IV percentile, there may not be that much more vega upside.
 
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Ultraviolet
Posts: 1655
Joined: August 15th, 2012, 9:46 am

Long AAPL / Short GOOG Trade

October 29th, 2013, 5:29 pm

Here's a part stock-picking fun (I don't put more than £3k in the same stock). My "clothsies" portfolio: bought Ted Baker before announcing results and quickly sold after it made 70% afair (I anticipated a nice jump, but I don't think they have a big potential) and sold Burberry because it stopped growing. For the sum I bought pharmaceutics for my "Fat people get sick" portfolio and some Eastern European stocks: bank + another clothsies (girls' stuff :-)). My "Big Data" portfolio: keeping Amazon (goes up nicely) and IBM (went down after I bought it :-/), and recently added eBay. My "Solar Energy" (in a very broad sense) portfolio: decided to keep Dixons despite/since I've already made quite a lot on them; What do you think about Sharp? - I don't like it's not very liquid, but they keep going back to my watch list... Bio-tech part of my pension funds performed nicely last year so I plan to buy some bio-tech stocks. Currently trying to compose an "Africa" portfolio, but it seems to be a bit too early for that. My biggest mistake: zero profit on Nissan ("green cars" portfolio will have to wait for better times); I also froze some money for too long in banks which were cheap... and remained cheap.
 
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AnalyticalVega
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Posts: 2260
Joined: January 16th, 2013, 5:03 am

Long AAPL / Short GOOG Trade

October 30th, 2013, 2:55 am

QuoteOriginally posted by: UltravioletHere's a part stock-picking fun (I don't put more than £3k in the same stock). My "clothsies" portfolio: bought Ted Baker before announcing results and quickly sold after it made 70% afair (I anticipated a nice jump, but I don't think they have a big potential) and sold Burberry because it stopped growing. For the sum I bought pharmaceutics for my "Fat people get sick" portfolio and some Eastern European stocks: bank + another clothsies (girls' stuff :-)). My "Big Data" portfolio: keeping Amazon (goes up nicely) and IBM (went down after I bought it :-/), and recently added eBay. My "Solar Energy" (in a very broad sense) portfolio: decided to keep Dixons despite/since I've already made quite a lot on them; What do you think about Sharp? - I don't like it's not very liquid, but they keep going back to my watch list... Bio-tech part of my pension funds performed nicely last year so I plan to buy some bio-tech stocks. Currently trying to compose an "Africa" portfolio, but it seems to be a bit too early for that. My biggest mistake: zero profit on Nissan ("green cars" portfolio will have to wait for better times); I also froze some money for too long in banks which were cheap... and remained cheap.please don't pollute my threads with rubbish. Thank you
 
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Ultraviolet
Posts: 1655
Joined: August 15th, 2012, 9:46 am

Long AAPL / Short GOOG Trade

October 30th, 2013, 7:16 am

QuoteOriginally posted by: AnalyticalVegaQuoteOriginally posted by: UltravioletHere's a part stock-picking fun (I don't put more than £3k in the same stock). My "clothsies" portfolio: bought Ted Baker before announcing results and quickly sold after it made 70% afair (I anticipated a nice jump, but I don't think they have a big potential) and sold Burberry because it stopped growing. For the sum I bought pharmaceutics for my "Fat people get sick" portfolio and some Eastern European stocks: bank + another clothsies (girls' stuff :-)). My "Big Data" portfolio: keeping Amazon (goes up nicely) and IBM (went down after I bought it :-/), and recently added eBay. My "Solar Energy" (in a very broad sense) portfolio: decided to keep Dixons despite/since I've already made quite a lot on them; What do you think about Sharp? - I don't like it's not very liquid, but they keep going back to my watch list... Bio-tech part of my pension funds performed nicely last year so I plan to buy some bio-tech stocks. Currently trying to compose an "Africa" portfolio, but it seems to be a bit too early for that. My biggest mistake: zero profit on Nissan ("green cars" portfolio will have to wait for better times); I also froze some money for too long in banks which were cheap... and remained cheap.please don't pollute my threads with rubbish. Thank you I'm sorry my response was not simplistic enough for someone who picks stock looking at P/E (still, I would make a completely opposite move with those two companies).
 
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katastrofa
Posts: 9455
Joined: August 16th, 2007, 5:36 am
Location: Alpha Centauri

Long AAPL / Short GOOG Trade

October 30th, 2013, 11:39 am

QuoteOriginally posted by: AnalyticalVegaQuoteOriginally posted by: UltravioletHere's a part stock-picking fun (I don't put more than £3k in the same stock). My "clothsies" portfolio: bought Ted Baker before announcing results and quickly sold after it made 70% afair (I anticipated a nice jump, but I don't think they have a big potential) and sold Burberry because it stopped growing. For the sum I bought pharmaceutics for my "Fat people get sick" portfolio and some Eastern European stocks: bank + another clothsies (girls' stuff :-)). My "Big Data" portfolio: keeping Amazon (goes up nicely) and IBM (went down after I bought it :-/), and recently added eBay. My "Solar Energy" (in a very broad sense) portfolio: decided to keep Dixons despite/since I've already made quite a lot on them; What do you think about Sharp? - I don't like it's not very liquid, but they keep going back to my watch list... Bio-tech part of my pension funds performed nicely last year so I plan to buy some bio-tech stocks. Currently trying to compose an "Africa" portfolio, but it seems to be a bit too early for that. My biggest mistake: zero profit on Nissan ("green cars" portfolio will have to wait for better times); I also froze some money for too long in banks which were cheap... and remained cheap.please don't pollute my threads with rubbish. Thank you So how are your trades doing, did you outperform UV's portfolio?
 
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chocolatemoney
Posts: 322
Joined: October 8th, 2008, 6:50 am

Long AAPL / Short GOOG Trade

October 31st, 2013, 9:19 am

QuoteOriginally posted by: AnalyticalVegaQuoteOriginally posted by: AlanQuoteOriginally posted by: AnalyticalVegaLong AAPL P/E - 12.93 Stock off All Time High of 680, now trading around 520Short GOOG P/E- 28.85 stock at All Time HighsA calendar strategy seems reasonableCall Spread for AAPL, Put Spread for GOOGComments?My comment is that GOOG already reported earnings this season and AAPL hasn't.A calendar strategy at this point seems more a bet on the magnitude of the jump fromupcoming AAPL earnings release vs AAPL implied vols, and also little to do with GOOG. Given your outlook, bullish vs. bearish vertical spreads seem to make more sense to me.hmm...vertical spreads? but then most of the vega would be hedged out. I would then need to change my name to AnalyticalDelta or something Seriously I like to be long vega generally, but with AAPL in the 54% IV percentile, there may not be that much more vega upside.If you wanna trade vega, trade vega. If a trade idea does not suit your goal of trading vega discard it, no matter of how profitable it may sound to you.Please don't embrace the common financial practice of sticking stuff in a portfolio/fund with a clear mandate because it may be highly profitable and making up convoluted explanations.
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