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Top Trades for Tue, 12 Jan 2016 14:46 – IMAX and IBM

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Top Trades for Tue, 12 Jan 2016 14:46 – IMAX and IBM
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Officially, for the OOP, we are adding a trade on IMAX:

  • Selling 5 2017 $30 puts for $3.20 ($1,600) 
  • Buying 5 2017 $28 calls for $7.50 ($3,750)
  • Selling 5 2017 $35 calls for $4.00 ($2,000)

That's net $150 in cash on the $3,500 spread.  Worst case is we own IMAX for net $30.30, best case is we make $3,350 (2,233%) in a year.  

Also, as a Top Trade Alert, we are putting out a note on IBM, which was our runner-up Stock of the Year for 2016 (to UNG):

  • Selling 2018 $110 puts for $10.50 ($1,050)
  • Buying 2018 $100 calls for $34.50 ($3,450)
  • Selling 2018 $120 calls for $20.50 ($2,050) 

This one is net $350 on the $2,000 spread so the upside is $1,650 (471% on cash) and the downside is owning IBM at net $113.50.