Stock / Symbol: Proshares Ultra Natural Gas / BOIL;
Option Strategy: put ratio spread;
Trade entry date: Jan 9;
Price at trade entry: $33.30;
Price at this post: $39.60;
Reasoning: BOIL has had a nice bounce, giving us the opportunity to close this trade early for a quick win. The current greeks are: delta of 6.3 (22.6 at open), positive theta of 1.7 (2.8 at open) and a vega of -1.5 (-3.3 at open). This trade's updated probability of success is 88% (65% at open) by Feb expiration. Those of you who played the optional covered call (short 1 Feb13 38 call for every 100 shares purchased), congrats, you're up 12% in 3 trading days! Take profits here or implement a 5% trailing stop.
Closing Trade Details:
STC 1 BOIL Feb13 31 put
BTC -2 BOIL Feb13 30 puts
for a max net debit of $0.20 per contract (GTC, limit order). The mid is currently at $0.30, so it may take a day or more to get filled.
Max Risk: $2910
Max Reward: $185 or 6.3% by Feb 15[private_monthly] at $30
Profit range: at/over $28.10 by Feb 15
Suggested Downside Stop: $30.15
Realized Profit / Loss upon fill: $70 or 2.4% (pre-commission)
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