Stock / Symbol: Lululemon Athletica / LULU
Option Strategy: [private_monthly]double calendar[/private_monthly]
Price at trade post: $62.30
Reasoning: For LULU's earnings announcement scheduled for sometime between Sep 9 - 14, I'm putting on a [private_monthly]double calendar[/private_monthly] with strikes about 3 to 4.5 points OTM. The Greeks currently show a delta of 1.64, a positive theta of 1.9 and a vega of 2.7. Please note that we're using weeklies for the short options. We'll look to exit this trade prior to the earnings announcement.
Trade Details:[private_monthly]
BTO 2 LULU Sep 65 calls
STO -2 LULU SepWk2 65 calls
BTO 2 LULU Sep 57.5 puts
STO -2 LULU SepWk2 57.5 puts
for a max net debit of $0.28 per contract (GTC order, limit order). The current mid is 0.22. If not filled today, ok to try again next week.
Requirements:
Cost/Proceeds: $56
Total Requirements: $56
Estimated Commission: $6
[/private_monthly]
Max Risk: $56
Max Reward: $200 or 357% (at current volatility level) at either[private_monthly] $57.5 or $65 [/private_monthly]by Sep Wk2 expiration
Profit Range: [private_monthly]$54.5 to $69 (at current volatility level) by Sep Wk2 expiration[private_monthly]
Suggested Downside stop: @ $55
Suggested Upside stop: @ $68.5
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