Booking 81.33% Gains in Bank of Ireland (IRE) options

Nicholas Vardy

Nicholas Vardy has a unique background that has proven his knack for making money in different markets around the world.

Both U.S. and global markets pulled back last week, as the Dow Jones dropped 1.49% and the S&P 500 tumbled 1.07%. Thanks in most part to surprisingly strong performance from China, the MCSI Emerging Markets Index was down only 0.88%.

Big gainers in your Bull Market Alert portfolio included Bank of Ireland (IRE), which soared 15.17%. This long-term Bull Market Alert position is now up 69.38% in 2013. With your October $10 call options (IRE131019C00010000) up 81.33%, sell half of your options to lock in your big gains.

Jazz Pharmaceuticals (JAZZ) also jumped 6.10%, hitting another new 52-week high. As you saw in your two Special Alerts last week, you booked gains of 57.54% and 101.64% in your related JAZZ option positions. With the stock up 39.47%, raise your stop to $78.30 to lock in at least a 35% gain.

You were stopped out of your bullish bet on a bounce in gold through the Ultra Gold Proshares (UGL) for a 10.2% gain. Your remaining October $50 calls sold for 9.47% gain, which made for a total of a 31.93% gain for your option position as a whole.

With low volume in the U.S. market as we near the final two weeks of August, historically one of the quietest periods of the year — and some of the previously strong performing sectors pulling back — I am holding off on making a new Bull Market Alert recommendation this week. That said, as the performance of your soaring position in Bank of Ireland (IRE) confirms, I am seeing surprising strength in some markets here in Europe.

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Portfolio Update

Bank of Ireland (IRE) rocketed 15.17% last week. The good news from Bank of Ireland’s recent positive earnings report was finally recognized by the market last week, and investors have apparently started buying the Irish recovery with a frenzy. A Central Bank of Ireland report last Friday also showed that Irish bank reliance on European Central Bank (ECB) funding fell a full 5.4% in July alone. IRE is a BUY.

Jazz Pharmaceuticals (JAZZ) jumped 6.10%, hitting another new 52-week high. JAZZ popped on news of its positive earnings report last week. My two “Special Alerts” last week directed you to close all of your JAZZ options positions for gains of 57.54% and 101.64%. To recap, quarterly revenues increased 67.7% year over year to $208.3 million. Second-quarter 2013 adjusted earnings of $1 per share were well above the year-ago earnings of 81 cents per share. Analyst firm Stifel Nicolaus also saw fit to reiterate its “Buy” rating and raise its price target. JAZZ is a BUY. Raise your stop to $78.30.

WellPoint, Inc. (WLP) gained 1.52%. WLP has been making a steady move back to its 52-week high at $90.00 ever since its post-earnings report dip. WLP’s share buyback policy is supporting its price, further supporting the bullish case for WLP. WLP is a BUY.

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Celgene Corporation (CELG) dipped 3.58% over the past five trading days. Celgene recently received European Commission (EC) approval to launch its new drug Pomalidomide Celgene for use in the European Union (EU). This drug helps decrease relapse in the treatment of “multiple myeloma,” a blood cancer where plasma cells accumulate uncontrollably in bone marrow. CELG is a BUY.

Gentherm (THRM) lost 4.20% last week, continuing to dip in the wake of its recent earnings report. I expect the stock price to stabilize and Gentherm to recover as the stock hits oversold levels and the pendulum swings back to the buy-side. THRM is a HOLD.

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Europe’s FTSEurofirst 300 Index hit its highest level since May. England’s FTSE 100, Germany’s DAX and France’s CAC 40 all opened the week up slightly, based on the expectation that an improved European Union (EU) economy will combine with a rising Chinese economy to help pull Europe out of recession.

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