#BullCallSpreads – Interesting trade and another lesson for me in the power of basis reduction.

Originally Bought Jan 2019 660/760 Bull Call Spread after last quarter earnings. Stock started dropping from almost the exact moment the trade filled. Continued selling weekly Bear Call Spreads against the position. Also, rolled down the LEAP short 760 to 710 for additional credit. Stock is still imploding as I type this but…

Bought to Close AZO APR 20 2018 625.0/650.0 Bear Call Spread @ .00 (sold for 2.25 and legged out for zero cost 🙂 )

Then:

Sold to Close AZO JAN 18 2019 660.0/710.0 Bull Call Spread @ 15.43

After reducing my basis of the original position to 9.23 the trade still made 6.20 without ever having a single uptick. Now that’s basis reduction!