Stock / Symbol: Apple Inc / AAPL
Option Strategy: [private_monthly]diagonal call spread + calendar put spread[/private_monthly]
Price at trade post: $131.55
Reasoning: Coming into this afternoon's earnings announcement, I'm going putting on a delta positive trade on AAPL. I'm going long with a diagonal call spread and short with a put calendar. This trade has a delta of 24.2, a positive theta of 16.1 and a positive vega of 39.9.
Trade Details:[private_monthly]
BTO 1 AAPL Jan16 130 call
STO -1 AAPL May 140 call
for a max net debit of $11.45 per contract (day order, limit order). The mid is currently at $11.25.
then,
BTO 1 AAPL May 124 put
STO -1 AAPL MayWk1 124 put
for a max net debit of $0.80 per contract (day order, limit order). The mid is currently at $0.75
Requirements:
Cost/Proceeds $1,200
Total Requirements $1,200
Estimated Commission $6
[/private_monthly]
Max Risk: $1,195
Max Reward: $500 or 41% (at current volatility level) [private_monthly] at $140 by May 15th
Profit Range: $124.20 to $164 by May 15th[/private_monthly]
Suggested Downside stop: 120
Suggested Upside stop: 150
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