Canadian e-commerce platform Shopify Inc (SHOP) offers 1.7 million online retailers in 175 countries (as of 2021) a range of services including payment, marketing, shipping and customer engagement. After online shopping boomed during the pandemic, it crashed ~80%, laid off 10% of its workers, and acquired Deliverr (product shipping) and Dovetail (influencer marketing). Shopify has also announced expansion into brick-and-mortar with its new product, the POS Go -- a device that allows retailers to provide wireless checkout anywhere in the store and analyzes sales, inventory and other data for merchants. Market cap $35B.
If SHOP has hit its low and is on its way up, here's an options strategy that maintains growth potential of up to 18% (26% annualized) but also allow some downside protection as SHOP is given room to fall 47% before breaking even.
Capital required: $2969.64
Hedged option legs:
Buy 1 $25 call
Sell 1 $30 call
Sell 2 $15 puts
Exp 6/16/23
Win probability: HIGH
If SHOP has hit its low and is on its way up, here's an options strategy that maintains growth potential of up to 18% (26% annualized) but also allow some downside protection as SHOP is given room to fall 47% before breaking even.
Capital required: $2969.64
Hedged option legs:
Buy 1 $25 call
Sell 1 $30 call
Sell 2 $15 puts
Exp 6/16/23
Win probability: HIGH