The iPhone gets into HK and Macau - is China next?
Answers
312 points
Market101 answered one year ago …
There were rumors that China Mobile was the one to bring the iPhone to China but CHl and Apple couldn't strike the right deal.. I think, ultimately, if Apple wants to get any type of penetration in China they'll HAVE to partner with China Mobile. The only other option is China Unicom and they don't have nearly the reach of scale of China Mobile.
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381 points
SirCrashton answered one year ago …
How much are you willing to lose? As others have previously indicated, you better know what you’re doing before trading options. Although your loss when buying a put option is limited to the premium you pay, AAPL put options are not cheap. Losses are potentially unlimited only if you are SELLING a naked put, i.e., you don't own the number of shares to cover your position if the stock price rises.
Let’s look specifically at AAPL as a put option trade. As I write, the least expensive in-the-money put option is the JUN 190P at $915/contract. To minimize your risk, the next cheapest put having the most intrinsic value vs. rapidly deteriorating time value is the JUN185P at $650/contract. The prices for these strike prices going just one month forward to July are $1355 and $1095/contract, respectively. Beyond buying at or in-the-money options you can reduce your risk further by placing a stop loss on your position.
AAPL is historically a volatile stock which means its price can swing widely within a day. This is an important reason for placing your purchase as a limit order as alanj recommends. You must control your entry price or you could find yourself in an untenable position if the stock gaps down on you. You could pay far more than you intended with the possibility that the stock would begin to rise after you’re locked into the trade. (I’m speaking from experience). Although you can place a stop loss on your trade, this can sometimes be counterproductive with a volatile stock. Since options prices move rapidly, it is possible that the option price could blow through your stop loss before your order is filled. Moreover, the stock/option could rebound after you get stopped out of the trade.
$190 seems to be the round number serving as a point of resistance to the AAPL stock price and could benefit a put position. However, if Apple’s new 3G phone with business applications takes off like the iPhone, your position could get wiped out very quickly. Also keep in mind that AAPL has traded as high as $202 within the last six months.
You have to decide how much time you want to allow for this trade to become profitable and how much money you are willing to risk. As you can see from the numbers I posted above, even a short-term play on APPL can be expensive. Given Apple’s recent string of successes, its core of dedicated consumers, and the media hype the company generates, this may be territory where even angels fear to tread.
391 points
slick answered one year ago …
Strange enough, China wasn't on the map of the iPhone "World Tour" (part of the Apple WWDC keynote). Russia also wasn't on the map.
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SirCrashton answered one year ago …
My answer to this question was misplaced. It was intended to answer the question from slick: "Can you help me with puts on Apple (AAPL)?
Slick, if you bought puts on AAPL since I gave my input you made an excellent trade. Within one week the JUN 185P went from $6.50 to $13.00; the JUN 190P went from $9.15 to $17.65. The JUL 185P increased from $10.95 to $16.95 and the JUL 190P rose from $13.55 to $20.70.
