Shares of Alibaba are in free fall after failing to live up to expectations. So we are recommending one of two things. One, sell to close the remaining call options. Or, two, allow them to expire.
Fortunately, we have done quite well with calls on this trade in the past… and will look to make up for these losses going forward.
In the past, here is how we did with this stock. We took gains of 106% and 131% on the BABA January 90 call, 74% and 65$ gains on the April 105 calls, 85% and 203% on the July 135 calls, and 72% on the July 145 calls, with a recent loss on the January 97.50 put.
Overall, we did okay with this stock. It’s no excuse for recent losses, though.
But we will make up for it with more wins like Lennar, Pulte Group, and the silver trade based on the gold-silver ratio.
Best wishes,
Ian L. Cooper
Inside Value Trader