IBM released earnings and stock price galloped up $25. Stock is showing strong uptrend gapped up above the highs of last 4 months.
We think that IBM will continue to move higher.
So, we have sold a Feb monthly expiry Bull Put Spread.
| SELL | -10 | TO OPEN | IBM | 21-Feb-25 | 237.5 | PUT | 1.38 | 0.65 | 25TRD-003 |
| BUY | 10 | TO OPEN | IBM | 21-Feb-25 | 232.5 | PUT | 0.73 | CREDIT |
The spread will expire in around 23 days. We do not think it will touch or fall below $237.5 which is the strike of the sold put.
We are looking at a potential full credit of $650 on $4350 investment, resulting in around 15% approx max returns.
