Stock / Symbol: Apple Inc / AAPL
Option Strategy: [private_monthly]diagonal call spread[/private_monthly]
Price at trade post: $555
Reasoning: I'm bullish on AAPL and am looking for a pop on their Jan 27 earnings announcement. Not risking much here (using minis) in case we get a negative earnings announcement. If things go bad, we can simply add to the long calls and continue to sell OTM calls each week or month until we've got a winner. This trade has a delta of 3.2, a positive theta of 5.4 and a positive vega of 17.5. Please note that the short call expires on Jan 31.
Trade Details:[private_monthly]
BTO 1 AAPL 10(Mini) Jan15 525 call
STO -1 AAPL 10(Mini) JanWk5 575 call
for a max net debit of $63.65 per contract (day order, limit order). The mid is currently at 63.45. If not filled today, ok to try again tomorrow.
Requirements:
Cost/Proceeds $636
Total Requirements $636
Estimated Commission $3
[/private_monthly]
Max Risk: $636
Max Reward: $170 or 26% (at current volatility level) [private_monthly] at $575 by Jan 31
Profit Range: $547 to $635 by Jan 31
Suggested Downside stop: @ $525
Suggested Upside stop: @ $598
[/private_monthly]
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