Timely

So far, the options trade I put on the other day hasn't worked out that well. I managed to find the only semiconductor company in the entire world that didn't miss earnings. Oh well, I still have 2 more expiration cycles - no point in trading out of it now, and I still think my thesis is correct.

On the positive side, I just barely avoided taking a loss on Friday. I'd been looking at some upside calls on SkyWest due to an upcoming event. Continental Airlines was looking to replace ExpressJet as their subcontractor for short-hop flights. The contract had orignially gone to RJET but, due to a series of complicated events involving subleases and availability of planes, the contract needed to be re-awarded. I recently spoke to an industry analyst, who said that since RJET didn't have the planes, it was almost a given that the contract would go to SKYW.

Since the contract was due to be awarded any day now, I figured some upside calls in SKYW would be a good idea. With the stock around 23.5, maybe some cheap 25 calls would be worth a shot. Unfortunately, Friday was expiration. The Julys were trading as if worthless, and I really didn't want to pay up 0.35 for the Augs. If we only got a small move in the stock, vol would collapse and I'd barely make any money. Not worth it. If I could pay 0.20 or 0.25, I'd probably try to buy 100 calls.

Just as I was cursing the timing of the whole trade, and debating whether dropping a 0.25 bid for the Augs would get hit out or just scare away the offers, one of our salesguys called out "CAL on the tape!" "Shit," I thought, "I just missed it." I pulled up the story on my newswire.

Continental Airlines Selects Unit Of Republic Airways For Regional Jet Contract

Guess that's $2500 back in my pocket.