Japan

[Vanraw]

Im wondering if there isnt a good buying opportunity on some of the Japan stocks that have taken a beating. I read today that the area impacted is highly agra, and that about 8% of the industrial business is there. Toyota has taken a pounding, and I seriously doubt the situation is going to impact thier quality or output.

Not sure though. Very scary stuff over there right now.

[Jakensama]

Shipping rates are gonna go up since the nuclear disaster means they will be, at least short term, importing a lot more thermal coal to generate enough energy... Maybe stocks in Aussie coal mines would be profitable.

[Grieve]

Infrastructures plays - massive amount of rebuilding is going to be required.

Nuke headlines crossing the wire right now are really bad...scary stuff.

[Vanraw]

Yea Hatachi lost 15% today cause they make equipment in the plants. Same for GE.

[Grieve]

Today is going to be the day to get your bargains...dow futures down 2.5%...

[Breand]

seriously, take advantage of the irrationality that is going on right now. The circumstances suck, but think of it as taking advantage of slimy investment bankers making stupid decisions as usual.

As they like to jokingly say on Zero Hedge all the time, "Buy the fucking dip!"

[Breand]

well my plans to buy stuff just got stuffed. $1500 car repair...hooray!

[Grieve]

seriously, take advantage of the irrationality that is going on right now.

I did! Bought an AAPL call spread expiring tomorrow at the peak of the selling yesterday, just sold it for a 47% return - not bad for one day. This is a great trading market.

(I don't want to seem insensitive to the horrors in Japan - making a sizable donation from the profits. I trade for the buzz of beating the market, not from worship off money...)

[Breand]

Just so I understand, you are basically doing this?

<!-- m --><a class="postlink" href="http://www.optionseducation.org/strategy/bull_call_spread.jsp">http://www.optionseducation.org/strateg ... spread.jsp</a><!-- m -->

I'd definitely like to move past the simple buy and sell strat, I have done a simple call option once as well for a small profit.

[Vanraw]

I've bought large into TM (Toyota) and HIT (Hatachi) this week.

For HIT I covered the purchase with $40 July puts so covering if the stock drops 20% from its $48 level. HIT dropped large due to the fact that some of the equipment in the nuclear power plants is from HIT. However when I looked at the last quarterly report, only about 8% of their revenue is from the power systems and nuclear is only a portion of that. These guys were trading at low $60 and staged to go higher prior to the Japan events.

So at $48, there is some good movement possibilities. The only open question for me is how damaged is there buildings in the effected area's. Same question / risk for TM. My gut is when the power plant stuff is behind them, business will start to ramp back to normal. FYI I bought the stock and not options or leaps cause its a Long buy, or at least until they hit around 20%.

[Grieve]

Breand,

Here's how you do this in Etrade:

First, enter an Option Order and select "Spreads". Do a buy open order for the lower strike price ($325 in my case), and a sell open order for the higher strike price ($330 here):



You select a "Net Debit" price type, which means you pay the difference between the two strike prices. I usually use the recommended "Midpoint". Ignore the price you see here (option has already expired). I paid $3.05 ($305) per contract, and bought 4 contracts, so, $1220 plus commission.

When you want to sell, do the opposite "Buy Close" the higher strike, and "Sell Close" the lower one:



This time you are using a "Net Credit", and again using the midpoint as a guide.

Below is how the trade shows up in your Gains and Losses:



You get a gain on the lower contract and a loss on the higher one. In my case the net gain on my $1220 bet was $1680-$1104 = $576 (+43%). If I'd held until expiration today I'd actually have made $780 (+64%), but Apple has been trading weirdly, and I didn't want to risk it.

I feel like a broker when I say this, but...this stuff is risky. I'd have lost a fair bit of money (potentially $1220) if my instincts had been wrong. If you are going to do this, I'd recommend buying a spread about a year out. Most of mine expire January 2012.

[Grieve]

I've bought large into TM (Toyota) and HIT (Hatachi) this week.

I've been tempted to do the same, but I'm a bit leery until the nuclear situation is completely played out. I remember BP - it was tempting to buy after it's initial drop, but then it dropped a LOT more after that, before eventually making a comeback.

I wish you good luck, though. It could be a really nice payday for you.

[Vanraw]

I've bought large into TM (Toyota) and HIT (Hatachi) this week.

I've been tempted to do the same, but I'm a bit leery until the nuclear situation is completely played out. I remember BP - it was tempting to buy after it's initial drop, but then it dropped a LOT more after that, before eventually making a comeback.

I wish you good luck, though. It could be a really nice payday for you.

Yea thats why I covered the HIT. It has allot more potential down side on the whole nuclear issue. I'm less worried about TM.

The one thing I am very confident of. The Japaneses people will over come this.

[Vanraw]

Really well done Opinion on the myths of the Japan impacts. Good stuff. It answers some of the quesitons related to the regions GDP impact, and Factory closings that I could not fund when I jumped in.

<!-- m --><a class="postlink" href="http://seekingalpha.com/article/259091-dispelling-myths-about-rebuilding-japan">http://seekingalpha.com/article/259091- ... ding-japan</a><!-- m -->