CLOSING the $BBY Options Action trade - mike

15jun - as usual OptionsAction failing to meet up to its advertised "constant trade updates" to this trade from 16may as seen below...so not seeing any on air comments on this trade it can be taking off for 1.70 today for a win. possible alternatives are to sell a July19put on monday to further reduce the cost of the SEP put if you want to keep holding. this trade and mikes other on-air trades in a google docs spreadsheet

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16may - on tonights fast money, mike khouw has a trade for Best Buy.. an odd trade again, here is the video..watch mikes face when brian talks..funny....the cameras still on Mikey..tonights show

Buy the June / Sep 19 Put Calender spread - sell the Jun19/Buy the Sep19 for about .95

mentioned that earnings are tuesday.. his comments that "these are the kind of circumstances " that line up for a calender spread... i disagree a bit.. the advantage of calenders is that the front month option decays faster than the back month and that the front month premium is elevated because of earnings (as seen in the IV)..the June IV is 57 and the Sep IV is 48 according to Trademonster. mike mentions that after the June rolls off he may be keeping the Sep puts (at a discount), also sneaks in at end that its for a range bound expectation.

This spread is right at the money. After earnings there will be some volitilty crush but not as much as most expect since its not hugely elevated. If the stock moves a few bucks in either direction this trade will be flat at best. an alternative would be that since he mentioned he would likely keep the Sep option, why not take a shot at the expiring May options..afterhours quote still shows about .30 left for this week.. make it a May/Sep 19calender spread..try to get that quick 30cents..if under 19 on friday opex.. roll it to the June 19put as the original spread is setup... if over 19 on friday, you keep the May 30cents, then monday sell the June 19.

I would not be putting mikes trade on till day of or day prior to earnings in case stock moves till then, additionally after the June put comes off the board..you can sell a July 19put, then an Aug, etc to keep working that cost basis down. bottom line i would not do mikes trade, doesnt mean it will not make money.

google docs spreadsheet of all of Mikes trades -->>spreadsheet