Trade Adjustment : MCP

Stock / Symbol: MolyCorp / MCP

Option Strategy: [private_monthly]combo (short put/long call), AKA synthetic long stock[/private_monthly]
Trade entry date: Feb 23
Price at trade post: $28.66
Price at this post: $25.22

Reasoning: With it looking like[private_monthly] we're most likely going to be long 100 shares of MCP @ $26 come Mar 17, we're going to start lowering our cost basis now by selling a Mar12 27.5 call. Our long 32.5 strike call will most likely expire worthless. In the event that MCP makes a miraculous recovery and is trading over $28, we'll likely close the trade for a relatively slight loss.

Trade Details:

STO -1 MCP Mar12 27.5 call
for a net credit of $0.30 per contract


Max Risk: $2,560.00 (adjusted from $2,585)
Profit Range: $25.60 to $27.90 by Mar 16
Max Profit: $40 with MCP between $26 - $27 by Mar 16
Suggested Stop @: 22.90

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