November 20, 2009: Blind Side, Planet 51, New Moon

There are three movies opening this weekend, one rather large one, and two others, whose studio executives are brave enough to release movies against one of the most anticipated movies of the year.

Let's get the small fry out of the way. First up is Planet 51 (PLT51), an animated movie about an astronaut who ends up on another planet, where the aliens look and act a lot like earthlings. I like the trailer, I think it's a funny concept, particularly for a kid's movie. Not many people seem to agree with me - the stock has been tanking, dropping from H$57 just a month ago to H$38 today. Much of that, I am sure, is because traders are assuming that Twilight 2 will overwhelm everything in its path. I'm not so sure - that's going to be a big hit, but primarily with young women. The strike price is H$20, which seems very high today, although it made sense a month ago. Call is (P51CA) not doing too badly, considering, just below H$2. The put (P51PU), as expected, is doing well, aiming at H$4. The CX derivative on HSX, interestingly, has followed the same trajectory, but hit a higher high (H$64), and is still in the mid H$50's. On cantorexchange.com, the same security is down to $45. It's opening on 2,600+ screens, which is a good wide release. There aren't enough reviews to get a good feel at rottentomatoes.com. So it doesn't look good - most of the signs are negative, except for the fact that the trailer is entertaining. Still, at this price, it also looks like a good deal. The second weekend for this movie will be Thanksgiving weekend, so assuming the word of mouth is even remotely decent, it should delist well above the adjust.

Stock: Long

Call: Short

Put: Long

CX on HSX: Short

Cantor: Long

'Planet 51' Theatrical Trailer @ Yahoo! Video

Bringing us rather powerfully down to earth is The Blind Side (BLDSD), Sandra Bullock starring in a true story about a Southern woman who takes in a young African American man. It's supposed to be for one night, but ends up being forever. That young man is now an NFL left tackle (hence the title - the left tackle defends a quarterback's blind side). The trailer is inspirational as all get-out. It's a great role for Sandra Bullock, a solid contrast to her other two roles this year. It's a powerful combination: a Southern woman, football, and a big, potentially threatening, African American young man. There's going to be a whole lot of redemption up there on the screen. This is going to play very, very well in the South. Which means that it may very well be underestimated on the coasts. The stock has been mostly moving up, and is around H$41. Strike price is appropriately set at H$15. Call (BSDCA) is below IPO, at H$1.61 as of this writing. Hmmm. But a $15 million opening weekend would translate to an adjust of H$40.5. So the call is predicting that the stock will not adjust much, if at all. The put (BSDPU) is moving up smartly, heading towards H$3. The CX option on HSX (BLDSD.CX) has been floating in the mid-H$40's, but trending down. On cantorexchange, however, it's up $3 today to $43. It's doing exceptionally well on RT so far, with 73% positive. It's also on 3,100+ screens. There is one strong positive: Tim McGraw is in it. You don't get more Southern star power than Tim McGraw, with the possible exception of his wife. His presence will give it all kinds of credibility where it counts.

Stock: Long

Call: Long

Put: Short

CX on HSX: Long

Cantor: Long

Then there's this little movie called The Twilight Saga: New Moon (TWLI2) about some cute undead guys. I can almost hear the shrieking teenage girls from here. I haven't read the books and have no intention of doing so. I didn't see the first movie and have no intention of doing so. So I'm not the best judge of where this is going, but I do sense a little bit of a backlash. Maybe that's because I am so uninterested in it myself. The stock has been climbing, of course, and is at H$260, or about a $96 million opening weekend. The strike price is H$90, and the call (TW2CA) is soaring, almost at H$9. Lots of people are very optimistic about this one. The put (TW2PU) reflects the same sentiment, dropping below IPO. There's a Holiday Warrant (HWTW2), with a strike price of H$220. That's in the clouds, too, at H$20. The CX option is, of course, higher than the stock, at H$273. It's only at 53% on RT at this point, but who cares? It's going out on a bazillion - sorry, only 4,000+ - screens. The price on cantorexchange.com, however, is below the price on HSX; it's at $245. That's unusual. I'm going to watch this carefully, but I am thinking that $90 million is optimistic for this opening weekend. The fans of the series are fanatical, but this is limited to one segment of the population. I just don't see a lot of guys going to this movie. An $80 million opening weekend would still make it a smashing success.

Stock: Short

Call: Short

Put: Long

Holiday Warrant: Long

CX on HSX: Short

Cantor: Short

'New Moon' Theatrical Trailer @ Yahoo! Video

Wow, I don't think I have ever been so wrong on an HSX prediction. New Moon didn't just open above $90 million - it grossed almost that much on its opening day. It cleared $140 million. Never underestimate the power of teenage girls! I got everything except the holiday warrant wrong. Fortunately, I caught my mistake early, and reversed position on Cantor. I wasn't soon enough to reverse my position on HSX, but at least I made money somewhere. I did get everything right about The Blind Side, so the weekend wasn't a total wash. That did extremely well, clearing $34 million, and adjusting up by H$53. Nicely done, Ms. Bullock. Planet 51 didn't do all that well, only pulling in $12 million, and adjusting down by H$4. I was wrong on the stock, but right about the call and put. It's too early to tell if I got the CX derivative or the Cantor stock right. It is possible to make a judgment about the other two movies and their CX/Cantor securities - I was right about Blind Side, wrong about TWLI2. So I got 8 right and 6 wrong, but I got the big one wrong. I will never live this one down. But I learned from it!

November 13, 2009: Pirate Radio, 2012

Just two movies coming out wide this weekend, one big one, one small one.

The big one is 2012 (2012S, the S standing for "Sony," the studio that made it), even though it's still 2009. The Mayan calendar supposedly ends in 20012. Some people think that means that the world will end on December 21 of that year, although I find this rather doubtful, given that no other religion has this belief. The Mayans, who lived a few centuries ago, had a calendar that reached way into the future; 2012 was just the end of the cycle, like a speedometer in a car turning over. But apparently lots of people find comfort in the certainty of absolute doom. The trailer is decent, with John Cusack and Amanda Peet earning big paychecks by looking terrified. The stock has been extremely volatile, gyrating wildly over the last few months. It's currently at H$152, up for the day and not far from the high of H$166. That's an opening weekend of $56 million. It's going out on 3,000+ screens, or possibly 4,000+ screens. A lot, anyways. Critics are not impressed, as expected, with only 36% giving it a fresh rating on rottentomatoes.com. Strike price is H$60, which is a good price, but higher than the stock. Call (201CA) is above H$3, but that's down from almost H$5. The put (201PU), meanwhile, is heading in the opposite direction, and is heading towards H$5. It's lower on cantorexchange.com than on HSX, which is not a good sign; it's trading around $135. I don't think it's going to be all that special.
Stock: Short
Call: Short
Put: Long

The small movie opening this weekend is Pirate Radio (PRADO), the true story of a group of rebel DJs who ran a radio station from a boat just off the coast of England in 1966. Personally, I preferred the original title, "The Boat That Rocked," although this one works, as well. I love the fact that it's a true story. The stock has been dropping, and is down to H$14. Strike price is at the bare minimum H$5, and the call (PADCA) is optimistically trading near H$3. The put (PADPU) is not far behind, at H$2 and a half. It's only going out on 900 screens, but you can bet that those are 900 well-chosen screens. Critics like it, although they aren't wildly enthusiastic, with 71% fresh on RT. It's trading at roughly the same price on cantorexchange.com. But Baby Boomers cannot get enough of themselves, particularly when they are nostalgic about their youthful rebellion and the attendant soundtrack.
Stock: Long
Call: Long
Put: Short

Wrong on all counts this weekend, as 2012 turned out to be a smash, and Pirate Radio sank like a rock (pun intended). I was investing strictly on my personal taste, not always a good idea. 2012 made $65 million, while PRADO made less than $3 million. I forgot that I find 6o's nostalgia incredibly stale. But it got a B+ from users on Yahoo! Movies, so I am going to hold it long to delist, working on the theory that older moviegoers - i.e., Baby Boomers - will hear good word of mouth, and will see it after the opening weekend. That's the hope.

November 6, 2009: The Fourth Kind of Men Stare at Christmas Carols and Goats

We're back to a normal release schedule this week. We're also at the beginning of the holiday season, which means three things: blockbusters, Oscar-bait movies, and Holiday Warrants on HSX.

First up this week is "The Fourth Kind," (4KIND) about alien abductions. Looks good, could be interesting. Stock has been rocketing up, but is down H$3 today to H$30. Call (4KICA) is doing well against a H$10 strike price, although the put (4KIPU) is also doing reasonably well. It's going out on 2,450 screens, not a bad release. Critics are not impressed. I don't think there's a lot of room on the upside, but there's not much danger on the downside. Go with the flow.
Stock: Long
Call: Long
Put: Short

'Fourth Kind' Theatrical Trailer @ Yahoo! Video

Cameron Diaz stares in a thrilled called "The Box," (THBOX) about a box that does strange things. The stock is tanking. I like Cameron Diaz, but not enough to see her in a cheesy movie about some bizarre piece of squareness. The call (BOXCA) is optimistically above the IPO price, but the strike price is H$10, so the call, at H$2 and change, predicts an opening weekend around $12 million, while the stock, at H$21, is suggesting something more along the lines of $7-$8 million. The put (BOXPU) is more sensibly also above H$2. Critics are mixed, with 54% on rottentomatoes.com. I shorted this on CantorExchange.com several weeks ago. Guess what I suggest you do today.
Stock: Short
Call: Short
Put: Long

<br/><a href="http://video.msn.com/video.aspx?mkt=en-US&vid=89c3732c-0168-404b-9c98-a6bc6dc0a5e8" target="_new" title="&#39;The Box&#39; Trailer">Video: &#39;The Box&#39; Trailer</a>

Easily the biggest release this weekend, and one of the biggest of the year, is A Christmas Carol (CAROL), a Walt Disney production of a Robert Zemeckis film, starring Jim Carrey. Oh, and by the way, it's by the classic by some guy named Charles Dickens. I like Robert Zemeckis, I think he's made some great movies, but I also think he is getting carried away with the technology on this one. The trailer looks amazing, with a motion-captured Carrey flying around London. Looks amazing, feels cold. Doesn't feel charming, which is supposed to be the point of the story. Stock is up today, but has been sinking of late. I expect that trend to continue. The call (ACCCA) is close to H$3, but has been dropping. It's against a H$45 strike price. I think $30 is more reasonable. The put (ACCPU), meanwhile, is rising. Critics are sort of in favor of it, with a barely fresh (61%) rating on RT. I short this on Cantor, too. It's going out on a bazillion screens, but I don't feel the love.
Stock: Short
Call: Short
Put: Long

'Christmas Carol' Teaser Trailer @ Yahoo! Video

In a great counterprogramming move, we have The Men Who Stare At Goats (MGOAT), about a US Army program to train psychic spies. Supposedly it's based on a true story. I am very much looking forward to this. Not sure how many people are, because it's really not a conventional movie. But boy do we need that in this movie season. Stock is down slightly, but has been rising steadily, and is in the mid-H$30's. The call (MGOCA) is a shade optimistically trading around H$3, against a H$15 strike price. That's possible, if a little unlikely. Given the uncertainty of this movie, considering it fits in the oddball-black-comedy genre, the put (MGOPU) is also flying high, around H$2 and change. It's going out on 2,200 screens, a good release for a movie like this. Critics are, again, just barely feeling the love - it's just barely fresh, at 60% on RT. Sounds like it's not as great as it could be, but still entertaining. This is one time I am going with my sense of taste and hunger for a smart, funny movie.
Stock: Long
Call: Long
Put: Long

'Men Who Stare at Goats' Theatrical Trailer @ Yahoo! Video

It was a good weekend here at TEQP.HSX - I called just about everything right. The only stock to come in above the strike price was 4KIND, which bagged $12 million. THBOX actually adjusted up, but it was so far down it didn't have much room to go down. I got the options right there. I got the stock wrong, but it only adjusted up by H$2, so it was basically a wash. MGOAT also adjust up, again just barely, by H$3. It missed the strike price, but not by much. I clearly made a mistake with my prediction for the put, because the call and put can't both be long. But I am going to go with my mistake. So I got the call wrong, and the put right. I nailed CAROL, within $1 million. I also nailed THBOX, even more precisely, but the margin of error is much greater with a stock like CAROL. I just don't think audiences are ready for a Christmas movie this far in advance of the holiday itself. Most people aren't even thinking of Thanksgiving yet! So I got 10 out of 12 right, and on the most important one, I bet against the market, and scored big. Like I said, a good weekend.