Stock / Symbol: [private_monthly]Coca-Cola Company / KO [/private_monthly]
Price at trade post: $67.45
Option Strategy: calendar call spread
Reasoning: Fundamentally, [private_monthly]KO [/private_monthly] is worth about $65 a share and is technically range bound between 66 - 71. As a steady company in a tight trading range, [private_monthly]KO [/private_monthly]remains an ideal calendar spread candidate. We expect to close the trade this Friday for around a 10 - 15% yield as the options we're selling expire this Friday.
IMPORTANT NOTE FOR AUTO-TRADE PARTNERS: if the customer is still long some of the Feb12 67.5 calls, adjust order such that # of long calls = # of short calls.
Max Risk: $752
Max Reward: $200 or 26.6% @ $67.5 by Nov 18th
Profit Range: $66.40 - $68.50 by Nov 18th
Suggested Downside Stop @: $65
Suggested Upside Stop @: $69
Trade Details:
[private_monthly]
BTO 4 KO Feb12 67.5 Calls
STO 4 KO Nov11 67.5 Calls
for a net debit of $1.87 per contract (GTC, limit order)
Requirements:
Cost/Proceeds $752
Option Requirement $0
Total Requirements $752.00
Estimated Commission $12.95
[/private_monthly]
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