Stock / Symbol: [private_monthly]Zions Bancorp / ZION [/private_monthly]
Option Strategy: calendar spread
Entry date: Oct 6th; Price at trade entry: $21.94
Price at Nov 24 adjustment: $19.47
Price at this adjustment: $22.79
Adjustment: Our worries about this stock going lower were incorrect. We're going to add some April 20 calls here to cap our current upside risk on the Calendar Spread. If the stock doesn't continue higher from here, past $24 by December expiration, we'll show an interim loss on the trade but we'll then just sell at or out of the money calls to further lower our risk while we wait for the stock to move yet higher.
Current Position:
Long 2 Jan12 20 Calls @ $4.83 (current value is $3.00)
Short 2 Dec 20 Calls @ $0.50 (current value is $2.73)
Note: we've already taken in $1.30 per contract from the sale of 2 Nov 22 calls
Adding the following leg:
BTO (Buy To Open) 2 Apr 20 Calls @ $3.75
Max Risk (adjusted): $1,350
Max Reward (adjusted): unlimited
Profit Range: $24.27+ (on Dec 17th)
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Chart:
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