Apparently, it is time to pick a line from Benjamin Graham’s favorite stock quote “The basic ideas of investing are to look at stock as a business, use the market fluctuations to your advantage and seek a margin of safety” and categorically, according to Buffet, this profound advice is timeless and will always be the cornerstone of stock investing. But to our theme topic, Boeing Company, on 26th of September this year suffered rather a major blow after the German air carrier Air Berlin unexpectedly terminated its orders for eighteen of Boeing’s 737s including 15 of the 787 Dreamliners. This cancellation was valued at $5 billion cumulatively for the 33 jets.
It is to be noted that Air Berlin had ordered for 20 737s by end of August upon which they received two before tendering their cancellation leaving the 18 uncompensated. The carrier which currently operates 80 Airbus planes including fourteen A333-200 unapologetically stated that they are in no way obliged to pay for compensation to Boeing company, and further added that the cancellation, and I quote, represents a further important step in the gradual harmonization of the airline’s narrow-body fleet.
The so called ‚harmonization strategy is, according to Air Berlin, a strategy aimed at reducing the future capital expenditure and improving their balance sheet. Boeing 787-8’s carries 242 passengers and has a maximum range of 14,500 kilometers while A330 carries 298 passengers with a maximum range of 12,300 kilometers.
However what was expected to work negatively for Boeing, evidently did not affect Boeing’s stock price. In fact, Boeing stock shares at the NYSE were seen to pick up by gaining 0.3% at $127.50 at noon that same Friday in 52-week range of between $113.34 and $144.57.
Assuming that you have read Boeing’s 20 year Forecast, Boeing believes that world airlines are bound to increase their AirBus demand. Increase in supply demand undoubtedly will lead to increased revenues to airplane manufacturers; Boeing included. In layman’s language, this implies that Boeing, if things go according to their prediction, it will surely be one company very far from being reckoned. Ask any stock expert and s/he will tell you that Boeing though can be shaken, is one company that can’t be broken.
How to Binary Options with Boeing
Now let’s talk about Binary Options. From what majority of you know, Binary Options are basically is a type of option where an investor/trader doesn’t consider the price of a financial asset, the only thing they are interested in is the how the value of the asset changes over a set period of time. The trader here is guided by instincts, if s/he believes that the market is rising, they purchase a “call”. However if s/he believes that the market is falling, they buy a “put”; as simple as that.
Putting ourselves in Boeing’s position, that is as investors, this is probably not the time to fret. Since this announcement things have yet to turn messy.
With the exception of a dip in stock value following the announcement, Boeing’s stock prices are very far from falling, professionally speaking, this is the time to take advantage of the bearish markets with the binary options trades. If I were to use Binary Options terminology, this is the right time to purchase “call”.
It is important for Binary Options traders or prospective derivatives traders to pay attention to headlines like this about Boeing. But utilizing the information and how the market reacts trader can build expectations and a level of situational awareness to help them find success in Binary Options trading.
The Boeing Company is an United States based multinational corporation that produces and designs a range of aeronautical vehicles that include many commercial airliners. Boeing is among the largest global manufactures of airplanes , is the second-largest aerospace defense contractor in the world. Boeing stock is a component of the Dow Jones Industrial Average