Stock / Symbol: Capital One / COF
Strategy: Short Butterfly Put Spread
Trade post date: 23 Sep 2021 / $167
Price at this post: $166.90
Update / Reasoning: With COF trading essentially where it was upon entry, this position's P/L is is bit negative at the moment. If COF can manage to remain above $165 thru the end of trading this Friday, the trade's full profit potential can be reached. However, unless COF can get back over $170 near term, this position will likely need to be held thru to Friday. Additionally, with the position at the most risk with COF trading at $160, I'm setting a hard, downside stop at/under $165.14 (COF's current 50 day average). The net position Greeks are currently: 12.5 Delta, -0.9 Gamma, 1.7 Theta and -0.6 Vega. In an effort to exit this trade early, I'm entering the following exit order now.
Trade Exit Details:
BTC 1 COF 15Oct21 165 put
STC 2 COF 15Oct21 160 puts
BTC 1 COF 15Oct21 155 put
For a max net debit of $0.30 per contract (GTC order, limit order). The mid is currently at a debit of $0.70.
Analysis:
Max Risk: $440
Max Reward: $60 or 13.6% with COF under $155 or over $165 on Oct 15th
Profit Range: COF under $155 or over $165 on Oct 15th
Estimated Commission (round trip): $5.20
Downside Stop at: $165.14
