FB #PutRatioJadeLizard
I’m focusing on 3-way trades now…theta positive trades with wide profit ranges that will make money with an underlying move in any direction. Lately my fav trade is to combine a put ratio spread (the pit-traders’ fav) with a Bear Call Spread for a Put-Ratio-Jade-Lizard. Here’s the trade I did today on FB:
Apr 6, bought 160 p x 2, sold 157.5 put x 4 for 2.35 net credit, 170/172.5 Call Credit Spread for .70 cr x 2, total credit is 3.05, since it’s greater than the CCS-width there is no upside risk. Break even is 152.60, with max risk being assignment of 200 shares of long stock at that level. So, that allows for a substantial continued downside move, or not. I did the trade awhile ago, it’s already up about 25%.
Sue
p.s. anyone else having trouble w/ email updates on posts? nevermind, my browser notifications were disabled somehow.
p.p.s Nice background Jeff!