TRADE IDEA: HSBC SEPTEMBER/JULY 20/27 LONG CALL DIAGONAL
I've done quite a few of these recently in the sell-off. Here's one that hasn't recovered a ton ... .
Metrics:
Max Loss on Setup: $550
Max Profit on Setup: $150 (27.3% ROC)
Break Even: 25.50 versus 25.75 spot
Debit Paid/Spread Width Ratio: 78.6%
Notes: You know the drill. Manage these like a covered call, rolling the short call out on approaching worthless and, if necessary, down, but not past your cost basis/break even.
Metrics:
Max Loss on Setup: $550
Max Profit on Setup: $150 (27.3% ROC)
Break Even: 25.50 versus 25.75 spot
Debit Paid/Spread Width Ratio: 78.6%
Notes: You know the drill. Manage these like a covered call, rolling the short call out on approaching worthless and, if necessary, down, but not past your cost basis/break even.