About 3 years ago, I met Joe Kunkle and he described his OptionsHawk service to me. I decided to sign up and I’ve been hooked on it ever since. In interest of full disclosure, I am not affiliated with his service or company. I simply want to pass along a great resource that I use and describe its main features:
2) The service is NOT just for option traders. Equity traders can enhance their trading results by following the large option trades made by the big institutions. Joe not only flags these big trades, but also provides quality analysis to let you know if there is a bullish or bearish bias to the trade.
3) There are different levels of service, but the best part is the Options Hawk Trading Hub. This is a LIVE Chat Room with Actionable Trading Ideas, Options Analysis, Wall Street Research, Breaking News, and much more. It’s essentially a browser-based stream of information that you can leave running during the day and use it to enhance your trading.
Here’s an example of how I used it recently:
If I see option activity in $MSFT or $GE, I read the information but I don’t act on it because these stocks are not on my watch list and they don’t fit my investment criteria. However, if I see activity in a stock that has ALREADY passed my fundamental and technical screens, then I am VERY interested. For example, on January 2, 2014, there was a bullish option trade in $AMGN. Just so you know what kind of detail you will get, here is the exact post from OptionsHawk’s Trading Hub (posted with his permission):
“Amgen (AMGN) with a large bullish trade as 2,500 July $125/$110 bull risk reversals are opened at a $2.90 credit, a willing buyer of 250,000 shares but wanting to have exposure to an upside move. AMGN has been posting impressive quarters and remains in a long term uptrend, though a recent choppy range and needs to clear $115 for a run at $120 highs. The $86B Biotech trades 14X earnings, 4.76X Sales and 3.96X Book with a 2.14% yield and 10% EPS growth. On 11-26 Piper reiterated an Overweight and $143 target. AMGN reported some positive Romosozumab data for increasing bone mineral density this morning, and on 12-17 its Phase 3 LDL cholesterol reduction drug met co-primary endpoints, so positive developments for its pipeline.”
Many Big Cap Biotechs were already on my screens, so the option activity led me into an equity position for my clients around $115. I already loved the technical picture, the fundamental story, and the fact that it’s in a strong sector. The option activity simply confirmed my views and ADDED to my conviction.
A few words of advice. This service is mainly an INFORMATIONAL product. Although Joe provides his real-time trades and generously answers questions during the day, DO NOT expect him to hold your hand through a trade. In other words, this service is probably not suited for beginners or people with little understanding of options. It is perfect for advanced traders and institutions looking to SUPPLEMENT the work they are already doing.
As a trader, I strongly believe that you have to put EVERY possible edge in your favor to be successful. Some of these factors include: Fundamentals, Technicals, Sentiment, Seasonality, and Option Activity. OptionHawk’s service is a great way to enhance your trading. I highly recommend checking out his site and at least signing up for a 10-day trial at www.optionshawk.com.