... covered zebra for a 9.93 debit.
Comments: I fiddled mightily with bullish assumption setups in this underlying and settled on this setup -- a covered zebra (zero extrinsic ratio back spread).
It consists of two parts: (1) a longer-dated zebra where I bought 2 x the 75 delta strike call and sold the -50 delta call to synthesize a 100 delta setup; (2) against which I sold a shorter-dated -30 delta call. This emulates the delta metrics of a covered call, but with a smaller buying power effect than either a covered call or a long call diagonal.
Metrics:
Buying Power Effect: 9.93 debit
Break Even: 49.96/share
Max Profit: 2.04
While you can manage the separate, bullish assumption spreads of the setup, I'll look to money/take/run at 110% of what I put it on for and/or look to roll out the short call to reduce my break even further should my take profit not hit.
Comments: I fiddled mightily with bullish assumption setups in this underlying and settled on this setup -- a covered zebra (zero extrinsic ratio back spread).
It consists of two parts: (1) a longer-dated zebra where I bought 2 x the 75 delta strike call and sold the -50 delta call to synthesize a 100 delta setup; (2) against which I sold a shorter-dated -30 delta call. This emulates the delta metrics of a covered call, but with a smaller buying power effect than either a covered call or a long call diagonal.
Metrics:
Buying Power Effect: 9.93 debit
Break Even: 49.96/share
Max Profit: 2.04
While you can manage the separate, bullish assumption spreads of the setup, I'll look to money/take/run at 110% of what I put it on for and/or look to roll out the short call to reduce my break even further should my take profit not hit.
Trade closed manually
Closed for a 10.63 credit; .70 ($70) profit.
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Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.