Stock / Symbol: Direxion Small Cap Bull 3x / TNA;
Option Strategy: [private_monthly]calendar[/private_monthly];
Price at trade post: $88.30;
Reasoning: I'm looking at directional trade on the Russell, betting on a small 2% pullback. TNA ia a supercharged way to play the Russell. If RUT is down 2%, TNA will be down 6%. I'm putting on a [private_monthly]put calendar[/private_monthly] on TNA. The greeks on this trade are: -23 delta, a 8 theta, and 11.6. I'm using a [private_monthly]calendar[/private_monthly] because I'm expecting volatility to rise. I plan on selling the weekly [/private_monthly] 84 puts until such time TNA hits 84. If TNA moves against us, we'll either stop out or adjust by adding a call calendar.[/private_monthly]
Trade Details:[private_monthly]
BTO 1 TNA May13 84 put
STO -1 TNA MarWk4 84 put
for a max net debit of $4.46 per contract (day order, limit order). The mid is currently at $4.36. If not filled today, it's ok to try again tomorrow.
Requirements:
Cost/Proceeds $446
Option Requirement $0
Total Requirements $446
Estimated Commission $3
Max Risk: $446
Max Reward: $180 or 40% (at current volatility level) at $84 by Mar 22
Profit Range: 81 to 88.50 by Mar 22
Suggested Upside stop: @ $91
Suggested Downside stop: @ $84
[/private_monthly]
Non-members, click here for access
