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Top Trades for Thu, 27 Oct 2016 10:23 – BAC

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Top Trades for Thu, 27 Oct 2016 10:23 – BAC
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BAC/Jeff – I think we discussed in Tuesday's post and the Live Trading Webinar but, as a new entry on BAC, I like:

  • Sell 10 BAC 2019 $15 puts for $1.85 ($1,850) 
  • Buy 10 BAC 2019 $13 calls for $4.80 ($4,800)
  • Sell 10 BAC 2019 $20 calls for $1.30 ($1,300) 

That's net $1,650 on the $7,000 spread that's $4,000 in the money to start and max gain is $5,350 (324%) and ordinary margin is just $1,500 – so it's nice and efficient. 

Worst case is owning BAC at net $16.50 – a small discount.  We traded in the bigger discount from the $15/20 spread for the better net gain as we're really not worried about them going lower (BAC was our 2012 trade of the year back near $5, so we've followed them closely for ages).  

 

 

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