Stock / Symbol: [private_monthly]Priceline.com / PCLN[/private_monthly]
Price at trade post: $534.96
Option Strategy: bear call spread
Reasoning: We continue to be bearish on [private_monthly]PCLN [/private_monthly] and are looking to take advantage of today's big up day in the market by selling calls. This is a credit spread with a 90% chance of success on a 1 week trade, for a 7.5% return. However, should the stock continue to trade much higher, we'll look to close out the trade quickly to avoid a big loss.
Max Risk: $930
Max Reward: $70 or 7.5% by Nov exp
Profit Range: $0 - $570 by Nov exp
Suggested Stop: at or above $550
Trade Details:[private_monthly]
STO -2 PCLN Nov11 570 Calls
BTO 2 PCLN Nov11 575 Calls
for a net credit of $0.35 per contract (day order, limit order)
[/private_monthly]
Requirements
Cost/Proceeds ($70.00)
Option Requirement $1,000.00
Total Requirements $930.00
Estimated Commission $12.95
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