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June 2010



Alternative Transocean strategy: buy calls

June 23, 2010 – Comments (3) | RELATED TICKERS: RIG

I previously mused about selling put options on Transocean (RIG). Upon further consideration, the downside risk to the shares is rather higher than I would prefer. However, buying calls is a potential strategy. The risks are different - in buying a call, you pay a premium which is then a sunk cost. You do not own the shares if the stock price declines below the strike. Furthermore, I prefer to go with longer dated calls to give an investment thesis greater time to play out - and even then, an idea may not play out within two years. On the other hand, your downside liability is capped at the price you paid for your option.   [more]



Alternatively, consider Transocean

June 19, 2010 – Comments (6) | RELATED TICKERS: RIG

Transocean (RIG) leases and operates drilling rigs to oil companies. They have the largest fleet in the world - and it so happens that the disaster occurred on a Transocean rig.  [more]



BP disaster a net benefit for onshore oil/gas producers

June 01, 2010 – Comments (0)

Whatever you think of the BP disaster - Gov. Barbour (R-MS) thinks this is no big deal and wants to drill, baby, drill whereas I think that BP America should be placed into temporary receivership - we can all agree that the disaster will have major impacts on energy stocks.   [more]

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