Earnings play on Netapp Inc.


Earnings play on Netapp Inc …
SELL -5 STRANGLE NTAP 100 (Weeklys) MAY4 14 36/34.5 CALL/PUT @1.23 LMT
(short strikes around the anticipated market maker move … can use cost of ATM straddle for estimation as well)
Days to exp. = 2
POP =~ 90.0%
Max. profit = $625(exc. commissions)
Buying power effect = $3,438
ROC (max. profit) = 480/991 =~ 18%
The idea would be to take off the spread tomorrow after the earnings announcement tonight EST.  Hence the actual ROC would be lower, since maximum profit will not be collected.

NTAP_5_21_2014

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This entry was posted in Earnings, NTAP, Options, Short Strangle. Bookmark the permalink.

One Response to Earnings play on Netapp Inc.

  1. Pingback: Earnings play on Netapp Inc. – Closing trade | One618 Trading Blog

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