#SyntheticStock – Don’t want all of my eggs in the AAL basket so taking a shot with LUV…

Synthetic Stock:

Sell to Open LUV JAN 18 2019 60.0 Puts @ 5.89
Bought to Open LUV JAN 18 2019 60.0 Calls @ 6.64

Disaster Puts:

Bought to Open LUV JAN 18 2019 57.5 Puts @ 4.75

This gives a net debit of 5.50 for the Jan 2019 position. Add the 2.50 point max downside and get a max loss possibility of 8.00. Based on that, and the 51 weeks remaining in the trade I only need to average about 16 cents per week in sales to cover the absolute worst case scenario.

Giving it a little breathing room in the beginning until I see how the recovery goes:

Sold LUV FEB 2 2018 61.5 Calls @ .41