Stock / Symbol: [private_monthly]Baidu / BIDU [/private_monthly]
Option Strategy: calendar call spread --> adjusting to diagonal call spread
Entry date: Oct 26th; Price at trade entry: $113.09
Last adjusted: Nov 24th with stock at $109.18
Current Position:
Long 1 Jan11 115 Call @ $9.24 (current value is $3.60)
Short 1 Dec 120 Call @ $1.28 (current value is $0.42
Adjusted Cost Basis: $5.96 (with sale of 1 Nov 115 Call ($1.61) & 1 Nov 120 Call ($0.81); 1 Dec 120 Call ($0.86))
Current Cash generated: $328
Current Uncalled return: 35.5%
Reasoning: We don't see [private_monthly]BIDU [/private_monthly] trading above $115 by December 17th so we're going to take our profits here on the short 120 call and sell the Dec 115 call to take in additional premium / further lower our cost basis
Adjustment:
BTC (Buy To Close) 1 Dec 120 Call @ $0.42
STO (Sell To Open) 1 Dec 115 Call @ $0.93
for a net credit of $0.51
Max Risk (adjusted): $545; Max Reward (adjusted): $92 @ 115 (Dec 17th); Max Return: 17%; Uncalled Return: 15%; Profit Range: $112.92 - $117.41 (on Dec 17th)
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