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Wednesday, May 8, 2024

Top Trades for Wed, 15 Jan 2020 15:03 – IMAX

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Top Trades for Wed, 15 Jan 2020 15:03 – IMAX
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In the Webinar, we wanted to add IMAX to the STP, which is going to be the LTP so really, this is for the LTP:

  • Buy 50 IMAX June $17 calls for $4 ($20,000) 
  • Sell 50 IMAX June $20 calls for $1.90 ($9,500) 
  • Sell 50 IMAX June $20 puts for $1.30 ($6,500) 

That's net $4,000 on the $15,000 spread so $11,000 (275%) upside potential if IMAX is over $20 on June 19th.  The risk is being assigned 5,000 IMAX at $20 ($100,000) but, realistically, maybe they are down 20% to $16 and the loss (if not rolled or stopped) is $4 x 5,000 or $20,000 – that's the true risk.  ToS says $8,494 in ordinary margin is required – pretty efficient.  

 

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