Stock / Symbol: SPDR Dow Jones Industrial Average / DIA
Option Strategy: [private_monthly]double diagonal[/private_monthly];
Price at trade post: $163.75
Reasoning: I'm going to use a [private_monthly]Double Diagonal[/private_monthly] on DIA with a -0.75 delta, a 2.3 theta, and a 3.4 vega. If DIA either trades up to [private_monthly]$168 or down to $159[/private_monthly], we'll either exit the trade or adjust the position.
Trade Details:[private_monthly]
BTO 1 DIA Febwk4 169.5 call
BTO 1 DIA Febwk4 158 put
STO -1 DIA Feb16 168.5 call
STO -1 DIA Feb16 159 put
for a max net debit of $0.30 per contract (GTC order, limit order). Try to get filled near the mid, currently at 0.26. If not filled today, ok to try again tomorrow.
Requirements:
Cost/Proceeds $30
Total Requirements $126
Estimated Commission $6
[/private_monthly]
Max Risk: $126
Max Reward: $115 or 91% (at current volatility) [private_monthly] at $159 by Feb 6th[/private_monthly]
Profit Range: $156.50 to $169.50 by Feb 19th
Suggested Upside stop: @ $168
Suggested Downside stop: @ $159
[/private_monthly]
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