Stock / Symbol: Direxion Small Cap Bull 3x / TNA;
Option Strategy: [/private_monthly]put calendar;
Trade entry date / price: Mar 18 / $88.30;
Price at this adjustment: $88.20;
Reasoning: Put this trade on with a downside directional bias. With the Russell 2k / TNA virtually unchanged since our entry, going to adjust the postion to a non-directional trade. Going to roll the short 84 strike put to next week's expiration and add a 91 strike May/MarWk5 call calendar. The addition of a call calendar will give us the following greek setup: 3.8 delta, 17 theta, and 18.5 vega. Keeping the downside stop at $84 and ratcheting up the upside stop to $91.75. Depending on when the stops are hit (days to expiration of the short options), we'll either close out the put or call side of the trade (or) close the entire position.
Trade Details:
BTC -1 TNA MarWk4 84 put
STO -1 TNA MarWk5 84 put
at the market. current mid is a net credit of $0.98 per contract.
Then,
BTO 1 TNA May13 91 call
STO -1 TNA MarWk5 91 call
At the market. Try for the mid +.05. Current mid is at a $3.65 debit per contract.
Max Risk: $740
Max Reward: $100 or 13% (at current volatility level) between $84 and $921 by Mar 29
Profit Range: 82.50 to 92.75 by Mar 29
Suggested Upside stop: @ $91.75
Suggested Downside stop: @ $84
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