Options GOODIES

[Murphey]

LNKD Earnings Play / Sell A Vertical


Weekly, this Friday exp, IV is 125%
MMs have the move at 25 bucks.

This is a trade idea, not investment or trade instructions:
240 is the current price.
Two standard deviations is 50 bucks.
There is .25 cents in premium selling the 285/290 call credit spread.
As long as LNKD ends Friday under 285 we keep the full 25 cent credit. Don't wait on Friday. Tomorrow is the close out day.
The trade is just to get your feet wet.
Sell the 285/290 call vertical for 25 cent credit per contract.
10 contracts will get you a 250.00 credit.
Earnings after the close today. Tomorrow morning, the IV crush
will be on and the options will lose significant value.
The target is 200 bucks if you trade on ToS. When the options
bid is a nickel or less, you can close the trade at zero trade fee.
You could let them expire for the full .25 cents.
On a spread, it's advisable to close before expiration so there
is no risk of assignment. Paper trade it.

Cheers