Stock / Symbol: Direxion Daily Financial Bear 3x / FAZ
Option Strategy: [private_monthly]calendar[/private_monthly];
Trade entry date / price: Apr 4 / $43.30
Price at this adjustment: $42.50;
Reasoning: The Apr13 50 calls we sold will expire worthless today, allowing us to keep the $44 (10% uncalled return) in collected premium. Now, I'm selling next weeks 47 calls. After this adjustment, our greeks will be: 46 delta, 2.3 theta, and 13.2 vega. With the sale of the 47 strike calls, there is a margin requirement of $600 and I'm reducing the upside stop to $46.80; at which time we'll take profits.
Trade Adjustment Details:[private_monthly]
STO -2 AprWk4 47 calls
for a min credit of $0.15 per contract (day order, limit order). The mid is currently at $0.17. Try for the mid less 0.01. If your broker won't let you do this with the other short calls still open, you'll just need to roll them to the AprWk4 47 strike calls. If not filled today, it's ok to try again Monday.
Requirements:
Cost/Proceeds ($30)
Option Requirement $600
Total Requirements $1026
Estimated Commission $3
[/private_monthly]
Max Risk: $982 (accounts for $44 in captured premium)
Max Reward: $200 or 20% (at current volatility level) at $47 by Apr 26
Profit Range: 44 to 49 by Apr 26
Suggested Upside stop:[private_monthly] @ $47
Suggested Downside stop: NA
[/private_monthly]
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