Follow Up: Option Case Study on Pfizer, Inc

Tom Gentile

Posted in
Options Trading

By: Tom Gentile
November 14th, 2022

3 mins read

Check out the first part to this post here: Option Case Study on Pfizer, Inc.

How is the Pfizer Inc. (NYSE: PFE) Option We Highlighted Last Week Doing?

Last week we highlighted a call option on Pfizer, Inc. (NYSE: PFE).  We did this as an educational means of showing you how one can look at the results of the scans from our Morning Reports lists and track them virtually or as a paper trade to gain conviction for options that show up on these lists.

We don’t look at the options on these lists as recommendations and wouldn’t tell you to  consider them recommendations either.

They are, as we see it, a starting point for options trade selection.  They are categorized by largest option volume for the day for both call and puts, most open interest and even run checks on those with expensive and cheap IV.

What we showed last week was an example of an option from the list that we said try and track it (NOT do an actual trade on it) and see how it goes.

The option we highlighted for that sample / case study was the Pfizer, Inc. (NYSE: PFE) June 16, 20233 Call.

The closing price that day, 2022-11-07, for that option was $5.50 or $550 per contract.

Here we are a week later, and we thought we would do a check on that and show you if there is a profit or loss in the scenario.

PFE June 16, 2023, $45 Call Now

Figure 1: PFE June 16, 2023, $45 Call Option Data from Today 2022-11-14
Figure 1: PFE June 16, 2023, $45 Call Option Data from Today 2022-11-14

What you see below is an option that is showing a gain over its value from what it was at the close of the 7th.

Look at the green box and it shows the closing data for today 2022-11-14.

We look at the Mid-Quote or the Mid-Price as that is a price one can ask for versus taking just the bid or offer (ask) price.

The bid and Ask (also boxed in with a green color) shows 7.00 x 7.15.  Take the mid-price of those two numbers and that is a price one can ask to ‘Sell to Close’ for.

That is what the software uses to produce the numbers/percentages in the Profit  and Rate of Return section.

The profit is $1.58 or $158 per contract.

Now there is a lot of time left until expiration so one can hold onto this and let it continue to work.  And by work we mean see it the stock will trade higher.  So long as the stock goes higher the option should increase in value, (up until the expiration date gets closer.

Trade Management

From here note for some of our options strategies we like to target a 100% ROI goal with a 50% stop. If it goes up, (the value of the option that is) and we have an even number of contracts and it hits the 100% target ROI, we consider selling half and letting the rest ride or just close out the entire position.

App: Toms Option Tools

Toms Option Tools scan the markets for bullish and bearish trade opportunities using our proprietary scans and strategy algorithms. TTR Darknet finds bullish entries based on triple stack channel collisions. Money Calendar identifies seasonal patterns with at least 90% accuracy looking back 10 years. Weekly Cash Clock finds short term opportunities that last a week on average. Microcurrency Trader applies Darknet technology and moving averages to cryptocurrencies. Velocity Trader utilizes volume spike and Velocity indicators on custom stock lists. Quantum Scripts scans the markets for momentum acceleration signals and employs Quantum noise filters. Optimal Trader finds directional pre-earnings opportunities that are optimized for entry date, stock movement, and volatility surge. My Trades tracks the profit/loss of your trades, displays stock charts and risk graphs, creates new trades, and edits existing trades. Morning Report provides top 10 option rankings in 6 categories each day.


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