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« Silver Hit by a Fed Rate Rise | Main | Silver Wheaton Corporation: Another Quality Acquisition »
Tuesday
Feb162010

Silver Wheaton Corporation Call Options Update

SLW chart 17 feb 2010.JPG


Just a quick note to update you on the Call Options that we purchased on Silver Wheaton Corporation (SLW) and they are the JUNE 2010 series at a strike price of $15.00 and $16.00, for which we paid a price of $2.02 and $1.60 respectively per contract.

As we write these contracts are trading at $2.40 and $2.20 respectively, so we are off to a nice start. Silver Wheaton is 4.56% up at the moment for a gain of $0.70 to $15.84 on the back of silver which is up $0.60 and gold which has put on around $20.00/oz.

Why is this? Well the US Dollar has fallen out of bed, dropping from 80.50 to 79.60 which in turn sends gold north and so on, as we suggested when we posted an article entitled: Silver Wheaton Corporation: Buy This Dip, when SLW stood at $14.38, today it stands at $15.85.



If you have followed us into this one then hold on tight as we feel there is more to come.

Silver Wheaton Corporation trades on the New York Stock Exchange and the Toronto Stock Exchange under the symbol of SLW and is currently trading at $15.85.

The Company has a market capitalization of $5.43 billion, with 341.28 million shares outstanding, a 52 week trading range of $5.66 to $17.80 with an average volume of 6-7 million shares traded.


All the best.

Got a comment then please add it to this article, all opinions are welcome and appreciated.

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Reader Comments (10)

take profits guys, because i am short silver again today after being forced to take profits at 15.80 . not sure if it can go higher than 16.30, maybe, but certainly not above 16.50 because gold won't do it to break above 1144. next week it is going to be a bear party again, and i hope in march we are going to kiss & goodbye to above 1000 gold prices

February 17, 2010 | Unregistered CommenterDi

That is wonderful for short term trades, but has anyone looked at the P/E of the stock? Speculation and scare tactics seem to be the new investment mantra. If you want to buy insurance against currency collapse or hyperinflation that is one thing but please, at least convince me my money has some chance of being invested in something with a reasonable rate of return. There are several other companies that actually have reasonable P/E and even earnings!! What a concept!

February 17, 2010 | Unregistered CommenterLarry Haines

If you're trading based on PEs for the miners, I would respectfully suggest you're not focused on the right metrics or the important information.

SLW is an excellent long term investment from a value perspective...and getting better. And, as the very smart guys who run this service are demonstrating, it's been a good trade...SO FAR. Look at the MACD and RSI. Looks good to me. OBV...okay. The COT structure has improved big time. Yeah, it's a reasonable spec trade. This doesn't have to be that hard.

Obviously, call buying is a risky business as anything can happen. I prefer debit spreads, but based on my experience, where I've had 139 out of 140 winning trades in the last 4 years or so (mostly on pretty conservative, in-the-money debit spreads that SHOULD have a high winning percentage so that looks like a better record than it is), I can tell you, these guys are looking at the right stuff when they make a trade. I'll trade alongside them any day.

My strategy is to find an undervalued stock that'll likely bail you out eventually if you're wrong in the short run and wait till the indicators line up positively, then pull the trigger on the trade. Do enough trades that are well set up and, over time, your winners will far outweigh your losers, even if you get blasted on occasion (Fall of 08).

Looking at PEs or tossing around price targets as if you KNOW what gonna happen next is a waste of time. Nobody values miners off PE and ANYTHING can happen at any time. Get used to it. Uncertainty is part of the game. They don't just hand you the money for being so very smart.

February 17, 2010 | Unregistered Commenterfallingman

i don't think so, goldman sachs KNOWs what is going go happen next hour because they use powerful supercomputers to calculate price, they analyze thousand of variables in a second, and we have to use our own neurons to calculate probabilities. the buy & hold is an old thing, it works of course, but it is slow and you have to have a big bankroll to hold on the volatility the computers rise on daily basis. If you want become rich, get into High Frequency Trading, but "buy & hold" ... hmm, no .... "sell & hold" is better right now, IMHO

February 17, 2010 | Unregistered CommenterDi

Darn IMF gold sale went through today. The whole PM complex slackened today.

February 17, 2010 | Unregistered CommenterDavid

Di,

Please check out the latest challenge from Peter Grandich, a $50,000 bet offered to the bears, this could be your moment, its on gold-prices.biz

February 18, 2010 | Unregistered CommenterSilver Prices

David,

Ye of little faith, please read our post on the IMF Gold sales just posted on gold-prices.biz, its not all negative and gold has bounced back $15.00 in todays session, bring on the bears!

February 18, 2010 | Unregistered CommenterSilver Prices

That was a nice bounce, but what about the Fed raising the overnight rate by .25%. Believe me I want to believe. Still I have nightmares from 2008.

February 18, 2010 | Unregistered CommenterDavid

Let me correct what I said about the Fed. That should read the discount rate. I did read an article on Stockhouse.com about the the COT report showing a massive reduction in short sale positions in COMEX silver and gold futures.

February 18, 2010 | Unregistered CommenterDavid

Also...a new update from MarketClub.com pointing to a recent high made in the price of silver and projections for a fading silver price/sideways trading range...
http://club.ino.com/trading/?p=1904

Me thinks that confusion is the primary way the markets are working right now. The COT says one thing and the charts tell another story. Bullish Engulfments followed by Bearish Engulfments?
Personally, I wouldn't Short this market with the Fed/US Govt. loaded with the taxpayers stimulus cash or should I say debt...still monitoring for an opportune time to buy GG & SLW Options.

February 23, 2010 | Unregistered CommenterMark

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