Wow, and down we go.
No particular reason – just the whole move up was BS…
Good reason to go long (HRB), who I like anyway:
- H&R Block (HRB +1.2%) breaks higher after the company announces that it will be the "exclusive DIY" desktop tax software provider at Walmart stores.
- "In addition to better prices, the value H&R Block can offer Walmart shoppers with our support features, such as free in-person audit representation and unlimited free tax advice, is among the many reasons we are so pleased to expand our partnership with Walmart this year," says H&R digital manager Heather Watts.
They are very reasonably priced at $26.65 and they do pay a 3.6% dividend so I really don't mind owning them long-term.
In the OOP:
- Sell 5 2020 $25 puts for $4 ($2,000)
- Buy 10 2019 $22 calls for $6.20 ($6,200)
- Sell 10 2019 $27 calls for $3.40 ($3,400)
That's net $800 on the $5,000 spread that's almost entirely in the money already. If HRB squeaks up from here, we make $4,200 (525%) but we will still have the open short puts for another year but, again, I'm very happy to own HRB at $25.
For the LTP:
- Sell 10 2020 $25 puts for $4 ($4,000)
- Buy 20 2019 $22 calls for $6.20 ($12,400)
- Sell 20 2019 $27 calls for $3.40 ($6,800)
So just doubling the OOP with an $8,400 (525%) upside on $1,600. Nice boring way to make 5x I think!
