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FCX at 43.39
I’m going to pick up a call spread in 18JUN with 36 days until expiration.
The 40 call is about 3.40 ITM and trading around 4.90
I’m paying about 1.50 of time premium for the 40 call. To cover the cost of the extrinsic value, I’m going to sell a 45 call, trading around 2.20
This will make it a 5 point wide Call Vertical spread for a debit of 2.70
I’m risking $270 to make $230 with about 50% prob of profit.
Risk Profile:
Order Ticket:
FCX at 44
I’m going to roll up my long 40 call to 43 strike, taking out about 80% of the risk in this trade.
Trade Adjustment:
FCX at 35.19
My remaining part of this trade is going to expire worthless. This trade is a loss but a much smaller loss, relative to original risk in the trade.
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