Stock / Symbol: Microsoft / MSFT
Price at trade post: $25.97
Option Strategy: [private_monthly]calendar call spread[/private_monthly]
Reasoning: MSFT continues to be a solid performer for [private_monthly]diagonal and calendar spreads because it doesn't move all that much.[/private_monthly] This trade reaches it's full yield potential by Jan 20. Although we can make as much as 75% on the trade, we'll look to close it out when were up around 20% on the trade. If the stock is trading beyond our profit range, we may add some additional calls or puts, depending on whether it's higher or lower than $26.
Max Risk: $630
Max Reward: $500 or 75%
Profit Range: $25.10 - $26.85 by Jan 20
Max Profit at: $26 by Jan 20
Trade Details:
[private_monthly]
BTO 15 MSFT Mar12 26 Calls
STO -15 MSFT Jan12 26 Calls
for a net debit of $0.42 per contract (GTC, limit order)
Requirements:
Cost/Proceeds $630.00
Option Requirement $0.00
Total Requirements $630.00
Estimated Commission $37.50
[/private_monthly]
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