Hello Investors,
We had our first meeting on our new day (Monday) of the week. We discussed historical vs implied volatility. Stocks that could crash upward with huge short interest. Strategies to utilize for shorting volatility (short options, condors, butterflies) and strategies to utilize to go long volatility (long options, straddles, long spreads). In addition, we have two trades below.
Bought a call butterfly in Apple (AAPL) prior to earnings out this Thursday. We are a little surprised that a bullish trade is what we came up with after taking a deeper dive into the long-term chart. The details as follows:
Buy to open: AAPL Aug 18th (monthly) 197.50 strike call (ratio of 1)
Sell to open: AAPL Aug 18th (monthly) 205.00 strike call (ratio of 2)
Buy to open: AAPL Aug 18th (monthly) 212.50 strike call (ratio of 1)
Debit: 1.69 – this order has filled
Max risk = 1.69 or $169.00 per spread
Max risk = 5.81 or $581.00 per spread
We are attempting to roll-up a short call in Draftkings (DKNG) as follows:
Buy to close: DKNG Aug 18th (monthly) 30.00 strike call
Sell to open: DKNG Aug 18th (monthly) 35.00 strike call
Debit: 2.05 – this is still a pending order
This will give us much more room before being “called out” of our stock position.
Have a great week!