Stock / Symbol: Draft Kings / DKNG
Strategy: Calendar Call Spread
Trade entry date / price: 03 Nov 2020 / $39.30
Price at this post: $41.14
Update: We haven't been filled yet at our desired level prior to tomorrow's earnings announcement. I'm opting to take a gamble here and hold the position thru the announcement. So, I'm adjusting the exit order to benefit from a pop up on the earnings. If DKNG reacts poorly to the earnings announcement, we have until October 2021 to work through the trade. If you'd rather not risk the trade thru the announcement, I recommend you close the trade out here for net credit of $7.65 or better, resulting in a small profit.
Adjusted Exit Order:
STC 1 DKNG 15 Oct21 50 call
BTC 1 DKNG 18 Dec20 50 call
For a min net credit of $9.35 per contract (GTC order, limit order). The mid is currently at a credit of $7.70.
Analysis:
Max Risk: $755 / My Risk: $735
Max Reward: $600 or 79% with DKNG at $50 at market close on Dec 18th
Profit Range: DKNG between $37.50 and $79 on Dec 18th
Estimated Commission (round trip): $2.60
Suggested Upside Stop at: $56
Suggested Downside Stop at: $34
Anticipated Profit / Loss upon fill: $200 or 26% (pre commission)
