We survived BIDU earnings and our BIDU spreads are making money.

Posted on April 28, 2011 by admin

BIDU reported good earnings and good forecast.  Today BIDU shares are up a bit.  Our BIDU spreads (135/140) are making money.  Two points to take home with:

  1. BIDU is not as volatile as used to be, reflected by the smaller price movement post earnings, unlike other tech concerns such as nflx, pcln etc.  This suggests that BIDU’s biz model is more mature  and its market leadership is unchallenged without a formidable competitor on the horizon.  As a result, BIDU’s time value will decrease.  This stock is a safe but less profitable one going forward for strategies focusing on premium selling.
  2. When placing a trade, one needs to take into account all variable factors such as overall market condition and individual stock chart pattern.  In the case of BIDU, 1. China is a growing and stable market; 2. US market is bullish; 3. BIDU’s chart is near perfect (reflecting its multi quarter good earnings).  Statistically, the chance of BIDU having a bad earnings report is low, hence my spreads trading.  It’s all about statistics.

About admin

Richard Cheng, M.D., Ph.D., is an avid Wall Street investor with 20+ years of investing experience. He is specially adept at observing the world to find the patterns and then design strategies to win his battle. Most, if not all, happenings in the world, follow certain patterns. These patterns may be complex, multi-factorial, not so intuitive at the first glance, or even may appear chaotic. However, even chaos has its own patterns. If you pay attention and be patient, you'll find them and then you will gain an upper hand in your battle. Using this blog space, he documents his trades and his thoughts as they happen. He uses this blog as a a notebook to help him better refine his strategies. Hopefully this will help you as well. Good luck in your trading.
This entry was posted in Daily Journal. Bookmark the permalink.

4 Responses to We survived BIDU earnings and our BIDU spreads are making money.

  1. Reggie Zhan says:
    April 29, 2011 at 12:05 AM

    Congrats!!!

  2. fatcow coupons says:
    May 11, 2011 at 6:03 AM

    whoah this blog is magnificent i love reading your posts. Keep up the great work! You know, a lot of people are hunting around for this info, you could aid them greatly.

  3. Heart healthy diet says:
    May 21, 2011 at 12:06 AM

    I found your website perfect for my needs. It helped me, and I’ll certainly install what you recommend. You have something good going here, keep it up!
    My site is on healthy diet plan.

Leave a Reply