Purchasing a put with a lower strike price than the written put provides a bullish strategy. Trade will be doing this coming week.
Stock: FANG
Current Price: 113.86
Short Put
WRITE
Option: 15th Jun $115.00 PUT
Price per option: $ 2.85
Contracts: #1 x 100
Total cost: $285
Long Put
BUY
Option: 15th Jun $110.00 PUT
Price per option: $ 0.83
Contracts: #1 x 100
Total cost: $83
Spread: Net debit/credit: $2.02 (net credit) x 100 = $202.00
Maximum risk: $298 at a price of $110 at expiry
Maximum return: $202 at a price of $115 at expiry
Breakevens at expiry: $113.00
Stock: FANG
Current Price: 113.86
Short Put
WRITE
Option: 15th Jun $115.00 PUT
Price per option: $ 2.85
Contracts: #1 x 100
Total cost: $285
Long Put
BUY
Option: 15th Jun $110.00 PUT
Price per option: $ 0.83
Contracts: #1 x 100
Total cost: $83
Spread: Net debit/credit: $2.02 (net credit) x 100 = $202.00
Maximum risk: $298 at a price of $110 at expiry
Maximum return: $202 at a price of $115 at expiry
Breakevens at expiry: $113.00
交易結束：目標達成:
This set up worked like a Rolodex watch.