LL sneaking back over $12 while Whitney is off duty.
In the LTP we have 20 2018 $13 calls we bought for $6.05, now $3.80 and we sold 10 Jan $25s for $5.50, now 0.60. Let's Roll the $13s to the $10s ($5) for $1.20 and add 10 more and sell 10 2018 $17s for $3 to pay for it.
As a new trade on LL, I'd go for the following:
- Buy 30 2018 $10 calls for $5 ($15,000)
- Sell 30 2018 $20 calls for $2.10 ($6,300)
- Sell 10 2018 $10 puts for $3.60 ($3,600)
That's net $5,100 in the $30,000 spread so $14,900 upside potential is about 300% against the worst case of owning 1,000 shares of LL for net $15.10. It's an aggressive play, because the stock is at $12 but it's stupidly low at $12.
Also, we had a new Butterfly trade on MSFT:
MSFT/Gbase – If you must stick with it, I'd sell the June $55 puts and calls, so at least you get $5+ and won't get hurt on a 10% swing (which they do often). $5/qtr is not too bad since you can buy the 2018 $42 puts for $3.20 and the $62.50 calls for $3.40, so investing $6.60 and getting $5 back right away and you have 7 quarters to sell for $35. In fact, let's add 20 of those to the Butterfly Portfolio and see how they do!
