Butterfly on CCU April

Discussion in 'Options' started by lula, Mar 23, 2008.

  1. cszulc

    cszulc

    Just thought I'd give another recommendation on CCU.

    This instead involves doing a credit butterfly, implying that CCU will move (and volatility will increase).

    The following trade can be done for a $2.19 credit:

    Selling the $32.50 June call
    Buying the $35.00 call
    Selling the $37.50 call

    Stock really only has to move out of a 80 cent range to be profitable (range is between $34.65 and $35.40).

    I have attached a graph that shows this. I did 40 of these today, and might be putting on some more tomorrow.
     
    #11     May 22, 2008