KR

#SyntheticStock – Not really using LEAPS and probably too long of a duration to qualify as a #Fuzzy. More of a hybrid here….thanks @smasty for the idea.

Sold KR JUL 20 2018 28.0 Puts @ 2.27
Bought KR JUL 20 2018 28.0 Calls @ 2.68
Bought KR JUL 20 2018 26.0 Puts @ 1.44

This gives a net debit of 1.85 for the Jul 2018 position. Add the 2 point max downside and get a max loss possibility of 3.85. Based on that, and the 27 weeks remaining in the trade I only need to average about 14 cents per week in sales to cover the absolute worst case scenario. I’m adding a small hedge out a couple weeks. This would keep me on pace for weekly sales to cover max loss but also still give the trade long deltas all the way up to about 30.75.

For some reason, I don’t have the ba**s to carry these completely unhedged. For now I’m changing it up a little by selling the first hedge with a lot of room instead of being so aggressive right out of the gate.

Sold KR JAN 26 2018 29.5 Calls @ .25