Each week, I’ll give an overview of a stock and Licia Leslie will follow that up with a chart analysis the next day. Bill Griffo will chime in with macro analysis and Andrew Giovinazzi will then finish out the week with a volatility breakdown.

Have a stock YOU want us to review? Email my team here. – Mark

Hey Traders,

A little known fact about me is that I was an early investor in offshore gaming way back in the internet infancy.

It was the mid-1990s and all was going well – we were about to IPO, and I was going to cash in on the internet boom. Then the Feds came, sent by the NFL, NBA, MLB and the NHL to shut down online gambling. A $1 billion pre-IPO value went to … zero. Oh well.

All the stuff our offshore internet site pioneered is around today in the guise of DraftKings Inc (Ticker: DKNG). If you play online poker, you’re likely playing a robot. All the stuff we were shut down for is now 100% legal.

DKNG has the good fortune of being around after the USA passed online gambling in many states. Their only real trouble is they spend too much on marketing.

1 year DKNG chart with 30 day IV and 20 day HV 

However, there are things to buy in DKNG options.

Let’s take a look.

DKNG Implied Volatility is Very Cheap

One year lows is one year lows. Like I mentioned in the webinar I did with Mark, options are darn cheap. A year ago, IV was 2-3 times as expensive.

For me, this is a simple trade of buying calls 2-3 months out and waiting in lieu of owning stock.  2 calls is a lot cheaper than 100 shares of stock, and I know from experience that gambling is a good business to run.

To Your Trading Success,

AG