Larry Fry's Blog Entries

Looking for a newsletter that provides aggressive high profit option trades?  Morningstar’s OptionInvestor (see 1st link below) is a good subscription service in terms of being both educational and fairly profitable; but it mainly deals with Long-Term Equity Anticipation Securities (LEAPS) and not the more aggresive, short-term options that tend to have more immediate pop to them.  Having said that, Schaeffer’s Investment Research (see 2nd link below) is also very educational and has a lot of different subscription service offerings in term’s of mixing and matching different Options types.  I currently have a subscription to SIR’s “Expiration Week Countdown” service, which keeps me on my toes during the option expiration week of each month.  Finally, OptionMonster (see 3rd link below) also has various subscription services based on one’s level of trading experience and desired level of risk.  It too has a good educational section as well.  Anyway, these are three of the more popular Options based subscription services that have recommended some real winners for me in the past.  But my overall returns from them have usually been tempered with additional recommendations (or “ideas”) that do not work out so well, so one needs to be aware of the overall picture here in terms of trying to achieve any semblance of consistent profitability.  Having said that, some additional technical/fundamental analysis and/or research on one’s part may be required in order to proactively eliminate the additional recommendations/ideas that won’t work out so well in order to increase one’s level of profitability. 

Specifically, for services that identify short-term opportunities that are about to pop, several of Schaeffer Investment Research’s services may fit the bill for you.  The “Expiration Week Countdown” service (which I currently subscribe to) specializes in these types of opportunities, as do Schaeffer’s “Event” series and “Players” series services.  The Expiration Week Countdown service cost me $395 for a year-long subscription, whereas the Event and Players series can be subscribed to (for lifetime) for $495 each.  Another service that one might look into would be the options subscription service from TheStreet.com.  And thinking in terms of comparing these different types of services, I actually believe that quite a few of them (except for Morningstar’s OptionInvestor service) tend to ”borrow” from each other to a certain degree and then repackage the information per their ongoing marketing models. In fact, Schaeffer’s and Zack’s partner-up on some of the services offered by Schaeffers, and OptionMonster and TheStreet.com may also have some common ties based on what I have read.  Finally, I find that most of the “popular” services out there will recommend some big winners for you, but (again) you’ll have to be able to weed out the non-winners that also get recommended in order to make this “option” a profitable venture on a consistent basis. 

Additional Comment:  As I alluded to above, my overall returns from the above mentioned subscription services in the past have usually been tempered with the many additional recommendations/ideas that do not work out so well, so one needs to be aware of the overall picture here in terms of trying to achieve any semblance of consistent profitability.  Having said that, some additional technical/fundamental analysis and/or research on one’s part is always required in order to proactively eliminate the additional recommendations/ideas that won’t work out in order to increase one’s level of profitability.  I find that these services will recommend a few nice winners for you, but you’ll definitely have to be able to weed out the non-winners (or losers) that also get recommended in order to make the service a profitable venture on a consistent basis.  In fact, I’ve gotten to the point with the Schaeffer’s Expiration Week Countdown service where I will weed out all but one or two of the recommendations during each expiration week of each month.  For example, last month (August, 2010) I eliminated from consideration all of the recommendations offered but one, which was one of the Netflix (NFLX) call options that was set to expire at the end of that week (Call -> NFLX -> AUG 21, 2010 -> Strike Price $110).  I selected this particuar one out of the bunch they recommended due to the recent high levels of volatility associated with NFLX’s stock price and volume at the times.  And this particular option call did quite well that week (i.e., more than enough to cover the cost of my annual subscription).  In a nutshell one is usually able to select one or two winners to play with from the list of recommendations made each expiration month; but my experience has been that most of them are usually worth ignoring after doing a little bit of research on them.

Hope this helps!

http://option.morningstar.com/Newsletter/Options.aspx
http://www.schaeffersresearch.com/cart/ViewAllProducts.aspx#aggressive
http://www.optionmonster.com/about/products.jsp

Note:  See link below for an enhancement of finance professor Peter Carr’s instructive paper on the implementaion of the Black-Scholes call/put options pricing model on the HP-12C programmable finance calculator by Tony Hutchins. http://www.hpcc.org/datafile/V23N3/V23N3P25.pdf