Stock / Symbol: [private_monthly]Johnson & Johnson / JNJ [/private_monthly]
Price at trade post: $61.62
Option Strategy: calendar call spread w/ protective call
Reasoning: [private_monthly]JNJ[/private_monthly] does not historically have drastic moves, and has weathered a series of negative press, making it a great calendar call spread candidate. We're also adding an additional leg to this trade to give us the ability to profit should the stock move higher than $64 by Sep expiration.
Max Risk: $928
Max Reward: unlimited
Profit Range: $54 +
Profit at $65 target: $963 or 103% by Sep 16th
Trade Details:
[private_monthly]
BTO 2 JNJ Jan13 60 Calls
STO 2 JNJ Sep11 60 Calls
for a net debit of $3.10 per contract
then,
BTO 2 JNJ Jan12 65 Calls
for a debit of $1.56
Requirements:
Cost/Proceeds $932.00
Option Requirement $0.00
Total Requirements $932.00
Estimated Commission $38.85
[/private_monthly]
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