Stock / Symbol: Russell 2000 / RUT;
Option Strategy: [private_monthly]bear call spread[/private_monthly];
Price at trade post: $1236.36
Reasoning: Never did get filled on the iron condor we attempted this week on RUT. With this market upswing, I'm now going with a [private_monthly]bear call spread[/private_monthly] on RUT. With an expected deviation of[private_monthly] +/- 52 points between now and March expiration, I'm selling the [private_monthly]1280 calls and covering with the 1290 calls for a net credit of $0.85 or better[/private_monthly]. The trade's greeks are currently: -4.9 delta, 5.76 theta, and -20.2 vega. The probability of success on this trade is 89%. If RUT trades [private_monthly]down significantly in the coming days, we'll look to either close the trade or add a bull put spread, making the trade into an iron condor.[/private_monthly]
Trade Details:[private_monthly]
STO -1 RUT Mar15 1280 call
BTO 1 RUT Mar15 1290 call
for a min net credit of $0.85 per contract. (day order, limit order). The current mid is $0.90.
Requirements:
Cost/Proceeds ($85.00)
Option Requirement $1000
Total Requirements $915
Estimated Commission $3
[/private_monthly]
Max Risk: $915
Max Reward: $85 or 9%[private_monthly] at / under $1280 [/private_monthly] by Mar 20th
Profit Range: [private_monthly]$0 to $1280 by Mar 20th[/private_monthly]
Suggested Upside stop: $1256
Suggested Downside stop: NA
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