Rocket IBM Call Spread 01-21-21
New Trade - IBM Debit Call Spread
In this trade we are the ones paying the premium looking for a pop to the upside on earnings tonight. IBM is trading at $130.75. Options are pricing in a $5.61 move in either direction with their numbers released after the bell. We are making a bullish trade and we are paying premium.
Both contracts in IBM expire tomorrow Jan 22nd.
Buy a $134 call
Sell a $141 call
This should result in a net debit of about $1.15. Our max risk is $115 per contract if IBM closes anywhere below $134 tomorrow. Our max profit is ($7 - $1.15 = $5.85) $585 per contract if IBM closes above $141. This is a bullish trade that is out-of-the-money and will expire worthless more often that not, so set your risk accordingly.
Both contracts in IBM expire tomorrow Jan 22nd.
Buy a $134 call
Sell a $141 call
This should result in a net debit of about $1.15. Our max risk is $115 per contract if IBM closes anywhere below $134 tomorrow. Our max profit is ($7 - $1.15 = $5.85) $585 per contract if IBM closes above $141. This is a bullish trade that is out-of-the-money and will expire worthless more often that not, so set your risk accordingly.
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