Trades for the week of May 28 to June 1

   Hi, I'm back with the trades- again. FB performed badly this week, going $8 dollars down or slicing 10B off its market cap. Not much action this week in the market, with the Dow still fluctuating around the 12300-12500 range.  Back to my portfolio, the week was fine, earning a total of 14% Ralph Lauren (RL) options, 20% on HP (HPQ) options, 63% on Tiffany (TIF) options and 38% on Dell Inc. (DELL) options. On the other hand, Guess? Inc. (GES) options decreased 18% in value after earnings and American Eagle (AEO) options too decreased 18% in value. GES and AEO moved too little after earnings, and in the end, time decay resulted in the loss.
   As the earnings season comes to an end, fewer trades will be made.


Trade 1: Reiterated Straddle
I have talked about Joy Global (JOY) last weekend
Now, at $59.70, what I'm going to do are the exact same trades from last week:
Buy a June 2012 ATM Call Contract ($60)
Buy a June 2012 ATM Put Contract ($60)

Trade 2: Straddle
Lion's Gate Media (LGF) reports earnings on Wednesday 30 May
At a price of $12.90, here is what I plan to do:
Buy a June 2012 ATM Call Contract ($13)
Buy a June 2012 ATM Put Contract ($13)
It's IV is a appropriate 40-60% range, worth a trade.

Trade 3: Straddle
Ascena (ASNA) reports earnings on Thursday 31 May
At a price of $19, here is what I plan to do:
Buy a June 2012 ATM Call Contract ($19)
Buy a June 2012 ATM Put Contract ($19)
It's IV is at a acceptable 40-50% range, good for a trade.

  And so, that's all for the trades. As promised, I will pick a company with a smaller market cap, here it is:
Stock Purchase: Ross Stores (ROST)

Ross Stores (ROST) has been on a unbelievably steady uptrend over the past year even as the Dow fluctuated up and down. I believe it still has space for growth at a market cap of 14B. Even so, it is the biggest apparel store chain in the USA. Still opening more stores, this large apparel company currently has more than 1100 stores across the USA. Targeting mid income families, I believe that this company will grow along with the rise in the number of middle class. Its management is superb and its sales are great, shown through its remarkable ROE of 46%, its quarterly sales growth rate of 14% and its quarterly EPS (Earnings Per Share) of 25%. All these numbers are great. Furthermore, it offers a quarterly dividend of 0.14 per share, which is not attractive but it is already good since its management is already trying to maximize shareholders' profits. (Ex-Dividend is on June 1st). It also has a stock repurchasing plan. It bought back 125M in shares in April 2012, which places it 158th of 1740 companies and top in its industry in terms of stock repurchasing . Its debt equity ratio of 0.09 is really quite remarkable too. Generating profits without borrowing much  growing those profits at an incredible rate with efforts in maximizing shareholders' profits gives you one great company to invest in. 

Disclosure: I am long DIS, KMB, T, MCD and may initiate a position in ROST in the next 72 hours