Stock / Symbol: Twitter / TWTR;
Option Strategy: calendar call spread
Trade entry date / price: 1 Apr / $51.00
Price at this adjustment: $37.40
Adjustment: After a doozie of an earnings report, we're going into claw back mode on this trade. I'm going to close the long 55 strike call and move to a [private_monthly]40 strike calendar call spread[/private_monthly], using a leap for the long call. The Greeks after the adjustment will be: 38.8 delta, 2.6 theta, and 2.6 vega.
Trade Adjustment Details:
[private_monthly]
STC 1 TWTR Jan16 55 Call
for a min net credit of $1.10 per contract (day order, limit order). The mid is currently $1.15. If not filled today, ok to try again tomorrow.
Then,
BTO 1 TWTR Jan17 40 Call
STO 1 TWTR May 40 Call
for a max net debit of $7.75 per contract (day order, limit order). The mid is currently 7.65.
[/private_monthly]
Max Risk: $1091 (upped from $440)
Max Reward: [private_monthly] ($161) or (15%) (at current volatility) at $40[/private_monthly] by May 15th
Profit Range: [private_monthly] Currently NA[/private_monthly]
Suggested Downside Stop: NA
Suggested Upside Stop: $41
Non-members, click here for access
