Stock / Symbol: [private_monthly]Walgreen / WAG[/private_monthly]
Option Strategy: bull put spread
Price at trade post: 34.73
Max Profit: $92
Max Risk: $308
Max Return: 29%
Profit Range: $33.77 +
Max Profit at: $34
Reasoning: This stock has solid support at the 200 day average and with Volatility high, we're looking at a bull call spread. This stock has a 62% probability of closing over $34 by December expiration. This stocks fundamentals are also very solid. Note: We're only risking $308 on this trade as our brokerage account is nearly maxed out. So, normally, with a $10K account, we're recommend trading 8 contracts instead of just 4.
[private_monthly]
Position Details:
Buy 4 WAG Dec10 33 Puts @ $0.26 $104.00
Sell -4 WAG Dec10 34 Puts @ $0.49 ($196.00)
for a net credit of $0.23 per contract
Requirements
Cost/Proceeds ($92.00) Credit
Option Requirement $400.00
Total Requirements $308.00
Estimated Commission $12.95
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Chart:
[private_monthly]
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