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Lions Gate Entertaiment and Time Warner Cable Trades
From the Buzz & Banter: Trading Comcast's acquisition of Time Warner Cable and Lions Gate distribution of "Divergent."
Michael Comeau    

This article was originally posted on the Buzz & Banter where subscribers can follow over 30 professional traders as they share their ideas in real time. Want access to the Buzz plus unlimited market commentary? Click here to learn more about MVPRO.

I'm close to calling audibles on two of my current trades, so I thought I'd update readers on my evolving thoughts:

Lions Gate (NYSE:LGF): I last said that I anticipated being out of the stock by the second week of March, which would be just ahead of the March 21 release date for Divergent.

Typically, Lions Gate rises aggressively ahead of key release dates (like for the first two Hunger Games films), at which point expectations peak, and then the stock sells off.

However, I'm starting to have doubts that Divergent is going to be a massive franchise for Lions Gate. This is largely a "feel" issue.

The hype surrounding the first Hunger Games film was quite obvious if you had your eyes open. Even in our e-book-dominated age, I was seeing teens and young adults with the physical books everywhere, and I actually overheard plenty of conversations about the books. The Divergent series is kicking butt on the Amazon (NASDAQ:AMZN) charts, but I'm just not seeing the real-world hype and I fear it could disappoint investors the way Ender's Game did.

So I'm moving up my likely sell window to very early March.

Time Warner Cable (NYSE:TWC): I'm rethinking my long trade in Time Warner Cable. I am still confident its acquisition by Comcast (NASDAQ:CMCSA) will go through. However, I am looking to replace or supplement my long January 2015 $145/$150 long call spread trade.

As it stands now, the position is modestly profitable, and will be very profitable if the deal closes (or investors become more assured it will close) before expiration.

However, if I'd done something more aggressive near term, like shorting the February 2014 $145/$140 put spread, I'd be in a much better position profits-wise, and I'd have better liquidity for possible exits.

So one trade I'm looking at is shorting the March 2014 $140/$145 put spread, which has less maximum profit potential than my current position (about $2 per lot instead of $2.85 per lot), but also a much shorter time horizon, and also the option to roll the trade forward).

I'll update readers should I take action in these names.

Twitter: @MichaelComeau

Follow the markets all day every day with a FREE 14 day trial to Buzz & Banter. Over 30 professional traders share their ideas in real-time. Learn more.
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Position in LGF, TWC.
The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

Copyright 2011 Minyanville Media, Inc. All Rights Reserved.
Lions Gate Entertaiment and Time Warner Cable Trades
From the Buzz & Banter: Trading Comcast's acquisition of Time Warner Cable and Lions Gate distribution of "Divergent."
Michael Comeau    

This article was originally posted on the Buzz & Banter where subscribers can follow over 30 professional traders as they share their ideas in real time. Want access to the Buzz plus unlimited market commentary? Click here to learn more about MVPRO.

I'm close to calling audibles on two of my current trades, so I thought I'd update readers on my evolving thoughts:

Lions Gate (NYSE:LGF): I last said that I anticipated being out of the stock by the second week of March, which would be just ahead of the March 21 release date for Divergent.

Typically, Lions Gate rises aggressively ahead of key release dates (like for the first two Hunger Games films), at which point expectations peak, and then the stock sells off.

However, I'm starting to have doubts that Divergent is going to be a massive franchise for Lions Gate. This is largely a "feel" issue.

The hype surrounding the first Hunger Games film was quite obvious if you had your eyes open. Even in our e-book-dominated age, I was seeing teens and young adults with the physical books everywhere, and I actually overheard plenty of conversations about the books. The Divergent series is kicking butt on the Amazon (NASDAQ:AMZN) charts, but I'm just not seeing the real-world hype and I fear it could disappoint investors the way Ender's Game did.

So I'm moving up my likely sell window to very early March.

Time Warner Cable (NYSE:TWC): I'm rethinking my long trade in Time Warner Cable. I am still confident its acquisition by Comcast (NASDAQ:CMCSA) will go through. However, I am looking to replace or supplement my long January 2015 $145/$150 long call spread trade.

As it stands now, the position is modestly profitable, and will be very profitable if the deal closes (or investors become more assured it will close) before expiration.

However, if I'd done something more aggressive near term, like shorting the February 2014 $145/$140 put spread, I'd be in a much better position profits-wise, and I'd have better liquidity for possible exits.

So one trade I'm looking at is shorting the March 2014 $140/$145 put spread, which has less maximum profit potential than my current position (about $2 per lot instead of $2.85 per lot), but also a much shorter time horizon, and also the option to roll the trade forward).

I'll update readers should I take action in these names.

Twitter: @MichaelComeau

Follow the markets all day every day with a FREE 14 day trial to Buzz & Banter. Over 30 professional traders share their ideas in real-time. Learn more.
< Previous
  • 1
Next >
Position in LGF, TWC.
The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

Copyright 2011 Minyanville Media, Inc. All Rights Reserved.
More From Michael Comeau
Lions Gate Entertaiment and Time Warner Cable Trades
From the Buzz & Banter: Trading Comcast's acquisition of Time Warner Cable and Lions Gate distribution of "Divergent."
Michael Comeau    

This article was originally posted on the Buzz & Banter where subscribers can follow over 30 professional traders as they share their ideas in real time. Want access to the Buzz plus unlimited market commentary? Click here to learn more about MVPRO.

I'm close to calling audibles on two of my current trades, so I thought I'd update readers on my evolving thoughts:

Lions Gate (NYSE:LGF): I last said that I anticipated being out of the stock by the second week of March, which would be just ahead of the March 21 release date for Divergent.

Typically, Lions Gate rises aggressively ahead of key release dates (like for the first two Hunger Games films), at which point expectations peak, and then the stock sells off.

However, I'm starting to have doubts that Divergent is going to be a massive franchise for Lions Gate. This is largely a "feel" issue.

The hype surrounding the first Hunger Games film was quite obvious if you had your eyes open. Even in our e-book-dominated age, I was seeing teens and young adults with the physical books everywhere, and I actually overheard plenty of conversations about the books. The Divergent series is kicking butt on the Amazon (NASDAQ:AMZN) charts, but I'm just not seeing the real-world hype and I fear it could disappoint investors the way Ender's Game did.

So I'm moving up my likely sell window to very early March.

Time Warner Cable (NYSE:TWC): I'm rethinking my long trade in Time Warner Cable. I am still confident its acquisition by Comcast (NASDAQ:CMCSA) will go through. However, I am looking to replace or supplement my long January 2015 $145/$150 long call spread trade.

As it stands now, the position is modestly profitable, and will be very profitable if the deal closes (or investors become more assured it will close) before expiration.

However, if I'd done something more aggressive near term, like shorting the February 2014 $145/$140 put spread, I'd be in a much better position profits-wise, and I'd have better liquidity for possible exits.

So one trade I'm looking at is shorting the March 2014 $140/$145 put spread, which has less maximum profit potential than my current position (about $2 per lot instead of $2.85 per lot), but also a much shorter time horizon, and also the option to roll the trade forward).

I'll update readers should I take action in these names.

Twitter: @MichaelComeau

Follow the markets all day every day with a FREE 14 day trial to Buzz & Banter. Over 30 professional traders share their ideas in real-time. Learn more.
< Previous
  • 1
Next >
Position in LGF, TWC.
The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

Copyright 2011 Minyanville Media, Inc. All Rights Reserved.
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