welcome back to "the suze orman show." all right. this makes it a wrap on "the suze orman show." can you believe it? we're starting our 12th year. that is a long time, people. that's a long time. but before we go, there is still one more thing that i want you to know. you know, i had one-on-one guests tonight, david and sheba. now, i love thad they came on, and they came on with this question and it was such a vital question. they wanted to have a baby. 29 years of age, each of them. but they wanted to know could they afford it, did they have enough money. how many times have i had guests on "the suze orman show" and i say to them, do you really think

you should have a baby? i don't think you have the money. and they'd go, we will just make it work. we want to have three kids, we want to have four kids, we'll figure it out somehow. i don't think so. you don't take a gamble like that. you know if you have the money or not. if you don't, so what if you're young and you wait a year or two, you're not going to hurt anything and maybe you can help everything. it's not just about having a baby. if we could always ask that question, i want to buy a home. can i really afford it? i want to buy a new car. do you think i can make the payments? o', i'm going to take out a student loan. will my salary be able to pay it back? just work through the numbers, peeps. work through the numbers so that you don't make a mistake that maybe you wish you hadn't done. now you know. all right. until next week, there's only one thing that i really want you

to remember when it comes to your money, and it is this. people first, then money, then things. now you stay safe. this is "options action." tonight, he says it could happen as soon as next week. we'll explain why. plus, talk about being connected. he has a way of looking at whether the stock goes up, down, or nowhere at all. they're going to breakthrough down and how would you like to double your money in just four days. scott's nation with the grande trade. "options action" begins right

now. >> from new york's times square, i'm sitting in for melissa lee. the s&p and the nasdaq also in the red but hope springs eternal on america's favorite stock. the tech giant rising. finishing the week in the green, is this stock ready to join the rally at last? let's get in on the money and find out. now, samsung's new phone was deem add bit of a dig by many. dan, let's talk some apple here. are they ready to give it out? >> well, it's really interesting. all week long this stock was kept under wraps. in a lot of ways, samsung had a lot of enthusiasm about some of the products that apple used to have. in a lot of ways, the phone they introduced yesterday looked like one of their versions of the s phone where they do the second-year reiteration of the

phone. i think that helped change the sentiment a little bit toward apple. and then you had investors looking for this, you know, cash distribution plan that needs to be expanded. i think a lot of reason why people are looking for next week is if they thought about the pattern from last year, the company held their shareholder meeting on february 23rd. there was a lot of anticipation of a dividend or buyback but they didn't. then on march 15, 2012, they issue add press release and held a conference. people are on their heels. they need this company to do it again, and they think one year from the day they do it again. >> for the longest time apple was buy the rumor, sell the stock. now it's true. the real issue, whether people were able to come up with the next product. of course, they're not the only ones who need to. if they don't do that, if they don't blow the doors off, then,

of course, there's little to attract the apple consumer away from them. they have so much cash. the company is so cheap that all you need is that kind of a catalyst, i think. >> dan, you've kind of answered the question as to why possibly next week. in other words we kind of had an ing li i inkling. my question is while. they've been pa ee've been patr. >> there's a reason for that. again, they're going take a tax hit if they bring it back. one thing, if they do give a big special dividend, then i think you have to say steve jobs has left the building. he's no longer the sort of vision ertha they're trying to play to. they say the steve jobs era is certainly over and they're going to have to give cash back. i think apple has shot too far

to the upside. the dividend, it's a wash. it doesn't do anything for you. >> there's enough cash that they could give 20 buck as share in the u.s. without imposing that tax. that's a lot. >> aside from the dividends, there's saut other things that have been suggested, that maybe they put a tender back in 2006. microsoft did a massive tender for shares which basically puts a floor in the stock in the meantime. if you think they're fundamentally challenge, which they may be, if they put it, shareholders know they will come back at that level. so that's one reason why this stock may have found an intermediate return. >> in the meantime, we've got to the picture here. dan is bullish, right? he's buying a calendar call spread. it is a little tricky, but this is exactly how it works. this is a strategy where you buy that call and if you finance a purchase you sell it to reduce your costs. so how do you make money? >> well, you want the stock to

fall just below the strike of the call that you are short on the first expiration. but above the strike of the call that you are long on the second expiration, so this requires a bit of timing. with that said, what is the -- >> that timing. listen, i'm not really bullish. if you look at the structure, this has a ten delta to it. what i want to happen is i want this stock to move slightly higher toward where my storks are and this trade makes money because it's an options trade. so what i'm doing is buying an april/may, 460 call calendar, okay? when the stock was about 440, 450, i sold one of the april 460 calls at $8 and i bought one of the may 460 calls for 15. and so the structure cost me 7 bucks. like i said, it's got ten deltas to it. it's not an outright bullish structure. it's at the moving average. it's not touched that level since october 2012. i think there's a good chance

that they come out and do something a little bit in line with expectations of investors, i think you have the stock move up, but i do believe when they report the fiscal q2, i think it goes lower. that's why i'm not long calls here. this is not an outright bullish bet. >> this is the kind of options trade if you look at it and it's starting to find a floor here, at least temporarily, you get to collect some of the decay. i don't think we're quite at that trade yet. i think it makes a lot of sense, especially if we see low volatility in the markets generally like we've been seeing over the last month or so. >> we like these because they get the math going. if it goes sideways, you're going to make some money. if it goes down a little bit, you're going to make some money. then it's as much of a home trade as it's going to be. >> listen. if i were to ask these two guys would you just buy calls for next week's event, i think you'd

both say no. this structure kind of solves that problem. >> the iphone is a wonderful product. i'm sure many of you viewers use it as well. but it still lacks stocks versus options. that you can object get here. want to buy 100 shares of apple? well that's going to set you back over $44,000. dan's call calendar offers big levels to the upside and only costs several hundred boxes. let's move on. the facebook social giant had a rough week, down 4%. now it's looking for revenue by taking a page from its biggest rival. cnbc's julia boorstin comes to us from los angeles. >> they're looking for ways to make hash tags more useful and more important and it would make sense facebook would try to embrace what twitter pioneered. they helped marketers driving their ads, drivinging twitter's

revenue 90% higher to $590 million this year according to emarketer. facebook users already use hash tags and they're used on instagram. now they're clickable so you can search for related posts with the same ease as searching for tagged photos. when mark zuckerberg talked about graphs, he talked about that. facebook may be taking a page from twitter in this experimentation, but, mandy, both facebook and twitter would like to recreate the success google has had with its search ads. and that's what this really is what it's all about. it's still very early. my sources tell me it's an experiment asian. i think that what this really is a small piece of the big story of search and the idea of facebook segmenting its service,

it's not a massive con tenth that you have to filter through, but they make it easier for you to filter it. it might be with tags on photos, the biline, search what music your friends are listening to, and with this, it would be hash tags. >> boy, it looks a whole lot nicer out there than it does here. while it's been a tough go for facebook shares, rival linkedin, they say it's the most expensive stock in the history of the world. let's get to the story with our own carter braxton worth. >> let's look at the chart and try to define the answer here. here's the ipo at 120. what's important about this, this is how precise the 120 level is. it opens up and plunges and gets back there at 120, 120, 120. a stock that has well-defined tops, have a lot of authority, almost two years, when do you

break out, there is a measuring objective for a move like that. let's look at the next chart. it's the exact same time frame. these are rules from 1930s and 40s and they apply today. the range before the breakdown is 60 to 120 or $60. if you add 60 on top of the 120, you get exactly 180. that's exactly where the stock reached today. we think it's met its objective and we would sell. >> what do you think the verdict is on this? >> this is a company that made 23 cent as share in the last 12 months. what is that, about 800 times earnings, 20 times revenue? over 50% since the beginning of the year. up almost 100% in two weeks. i look at this thing and i find it very hard. you certainly can't imagine what would propel somebody to buy the shares here. i think it's exceptionally expensive, so i'm inclined to agree with carter. >> but the warning is out there. okay. so a barish view here.

so mike is selling a call spr d spread. usually you buy call spreads so let's play it one more time. you try to find one with a same expiration. in this structure, you want the trade below it. your losses are kept at the strike of the call you bought. so one last time on the stocks versus options. want a short linkedin? bet very a lot of friends. what's the trade on this? >> all right. so using that 180 level that carter just referred to, i'm looking to sell the 180 call. i can collect about 11 president $8 $11.80 for that. net net i collect a credit of about $4.10. if the stock stays right here, even if it drifts mildly higher,

i'm still going to collect that premium and, of course, if it goes down, i'm going to collect all of it. i have a max possible gain of $4.50. max possible gain, over 5 bucks. >> you can't short this. it's absolutely impossible. you will not find relationships like this. to me i think this makes a lot of sense if you have an inclination that it could go sideways or down a bit. you can make a lot of money. >> i actually think dan makes an important point here. when you do that, you have to define your risk but you don't want to get into a situation where you risk a bunch to make a little. this one is $4 to $6 and that's about as bad a relationship as i would ever put on. >> just for the record, u i'm all linkedin, but don't use it. let's move on. got a question? you can send us a twee tweet @cbcoptions. we're going to answer that. that's right after the show on

our new website it's optionsaction.cnbc.com. got that? scott has a way to double your starbucks. meantime, this is what's coming up next. no need to google it because dan cashed in. how can he make even more money? find out when "options action" returns. time for "pump up the volume." the names that are heating up the options trade are heating up this week. extra, zrarks read all about it. this multi-media paper has been printing all the news that needs to be printed since the 1800s. others will be added to the media's platform so options traders turn the page betting that this activity is a sign of the times. who is it? the answer when "options action" returns. [ indistinct shouting ] ♪

[ indistinct shouting ] [ male announcer ] time and sales data. split-second stats. [ indistinct shouting ] ♪ it's so close to the options floor... [ indistinct shouting, bell dinging ] ...you'll bust your brain box. ♪ all on thinkorswim from td ameritrade. ♪ ♪

[ cows moo ] [ sizzling ] more rain... [ thunder rumbles ] ♪ [ male announcer ] when the world moves... futures move first. learn futures from experienced pros with dedicated chats and daily live webinars. and trade with papermoney to test-drive the market. ♪ all on thinkorswim. from td ameritrade. pump up the volume." at one time they called the average volume. >> you heard how "new york times" calls were active. scott, tell us more. >> this is a company a few years ago it couldn't monetize its website. now it's on fire its ricocheted

platform has it. >> it's time for the upside call where we look back on a winning phrase to see if there's way to make more money. a couple of weeks back dan made a bullish bet on yahoo!. the stock has rallied more than 10%, but dan's made much more, and this is how. on "options action" it's the option we live be "risk less so we can make more." that's just what dan did with his bullish bet on yahoo!. they were ready to run. but buying the stock, 100 shares cost look $2,000. so to spend less, dan set it for $1.25. to make money dan needs yahoo! shares to rise a strike above the $1.25 he spends or above. but honing up $1.25, come on, we can do better than that. to spend less, dan sold the july 22 strike call for 60 cents. now between the $1.25 buying

that lowest strike call and the 60 cents he collected by selling the highest call, dan's reduced the total cost of his trade to just 65 cents. now to make money, dan needs yahoo! to rise above the $25 strike price of more than that, 65 cents. but there is a trade-off. by selling that call, dan has kept his profits to the difference between the strike of the call that he bought and the strike of the call that he sold. hold on because paying 65 cents for a trade still ain't cheap enough for this guy, so to spend even less dan then sold the 18-strike put for 65 cents. now between the $1.25 he spent buying the call, the 60 cents he spent by selling the call and the 65 increments he collected by selling that other put, dan managed to put on the trade for free. now dan sees profits if yahoo! takes even a penny above.

>> that's something that's really inspired a lot of terrific people to sign on. >> it sure did, marissa mayer, but keep in mind there's a trade-off. he was able to sell it for 18 bucks. it's all good, though, because since the time of the trade yahoo! shares have added 12% making this trade a winner. now the biggest fan of "options action" -- >> gives you all the information you want. >> just wanted to know one more thing. what will dan do now? before we answer that, let's see how much money was made. had you bought yahoo! at the time of the trade, you would have made just over 10%. dan's trade required no premium and can be sold today for just under $95. technically that's a return of a million percent or so which should put a little smile on your face, a million-dollar f -

smile on your face. >> a smirk. >> dan, what do we do now? >> do you this when you have valuation support. now, you know, with the stock above the short call strike and the spread is worth half the distance, i think you take it off and you move on and you look for a better entry point. at the very least, if the stock's going to continue to go, you cover that put. >> this is a trade that would capitalize it. you're short more options than you're long, but you are still short that put. it's a low premium put. you don't want to be in that position right now, so you want to take off. >> i like that name but i would keep the call spread. >> okay. as a reminder as we head to the break, if you want updates on our trades, be sure to follow us on twitter @cnbcoptions. and dan posts trades as well on risk reversal. finally, if you're on facebook, stay posted on our trades throughout the week at

facebook.com/optionsaction. okay, we're done with all the p.r. now. up next, the final call from the options picks. >> what's your best option? follow us on twitter. see trades and analysis. see what's going on realtime. follow us on cnbcoptions. [ indistinct shouting ] ♪ [ indistinct shouting ] [ male announcer ] time and sales data. split-second stats. [ indistinct shouting ] ♪ it's so close to the options floor... [ indistinct shouting, bell dinging ]

...you'll bust your brain box. ♪ all on thinkorswim from td ameritrade. ♪

[ cows moo ] [ sizzling ] more rain... [ thunder rumbles ] ♪ [ male announcer ] when the world moves... futures move first. learn futures from experienced pros with dedicated chats and daily live webinars. and trade with papermoney to test-drive the market. ♪ all on thinkorswim. from td ameritrade.

it's the headline making news from around the world. no, we're not talking about the pope. we're talk about mini options. these are options that are just the ten ofgt the size of regular options. why do you need something like that? well, have you seen the price of an apple call? these products should make it more affordable for retail investors, yeah, moms and pops to bike stocks. eventually they'll be on names like apple, google, and amazon.

they'll be on the spooi and d.o.g. they'll start trading next week. looking forward to it. what do you think, guys? >> i think there's going to be a lot of activity out of it. it's an affordable way for people to start trading options, and because of all that activity, i thichg there's going to be a lot of liquidity there. >> scott? >> i think mike is absolutely right. you've got to remember they cover ten shares instead of a hundred shares. with a name like google, you have to narrow it. >> by the way, very important news. other news we're watching out for. welcome to the show. time now for the final call. the last word from the options pit before we let you go to the weekend. scott, kick it out for us. >> i wish we could get that back. >> dan? >> the set europe upin apple ne could be tough. >> what about you, mike? >> obviously i like telling that

call spread in linkedin. i would take it. and also it's so low right here, i kind of like calendar spreads in the picks as well. >> talking of expiration, our time has expired. i'm maggy. for more you can go to our website. we're going to see you hopefully next friday at 5:00 p.m. eastern. money in motion is up right after this break. [ indistinct shouting ]

♪ [ indistinct shouting ] [ male announcer ] time and sales data. split-second stats. [ indistinct shouting ] ♪ it's so close to the options floor... [ indistinct shouting, bell dinging ] ...you'll bust your brain box. ♪ all on thinkorswim from td ameritrade. ♪