I know nothing about Spreads, how did this YUM Trade make money?

yah, sadly it appears I'm just too stupid to understand your point here. I see not such information all I see is that some options (presumably) changed hands

 

on a more constructive note, what characteristics do you look for in a spread for selling to open?

 

• I don't sell credit spreads.
• I don't buy debit spreads.
• I only buy OTM options on stocks I expect to move enough to make the options payoff.
• I have watch list of about 10 stocks I follow, listed in my profile.

 

ooof that strategy has been very difficult to pull off successfully lately (last ~1yr) has it not? Follow thru has been hard to come by in my universe, mean reversion galore tho

 

check out this little beauty in Hong Kong this evening

(I got out way too quickly)
symbol = 250

 

Yes ........ Most trades lose. But a small handful make it worthwhile.

 

If the stock open's up at $67.90 what kind of gain is he/she looking at? PWE, SGY, CLR, WLL, and WFT were lighting up my Option Radar too. I can't say which small oil stocks I bought because of the rules, understand them but when you see 5000 Calls bought when a stock is at $.75 on the January 2017 paid on the Offer by consequtive buyers, it makes you desire to jump on board. Take a look at all the sub $3.00 Oil Stocks with massive Call Volume, their now making their big bets for 2016.


Now's the time for us to follow them Whales and Captain Ahab's Hedge Fund, how can you beat CLR which has held out the best of all the Big Oil Plays? I was looking for Oil Stocks without all the brutal debt load, so in your opinion how much will this Trader make because he did not just buy 1300 Puts of YUM.

YUM, I won't be surprised if it closes above $70 because I've experienced YUM's China Syndrome(4-5 times now) over the last four years causing it to tank after-hours below $70 only to climb back up to $70-72, things change and maybe it might not climb above $70 like it usually does. Remember MCD had horrible news, news that pushed it down to $87 only to be right back to a 2 year High Today.


Keep a eye on YUM, if it holds out I will buy the April $70s, when GIS started to fall because of the Gluten story, I bought some GIS. The Close offer's lots of good ideas. Back to the original question, just a guess, what do you think they will make if the stock hit's $68.50 and they close it out?

 

There are put debit spreads. This is the risk graph (I choose 1 contract)
First spread:

Second spread:

 

I think he made lots of cash, who ever that was that bought all those Puts, good job!