January 21, 2014 Trade Alert - Terry’s Trades Portfolio

I love the prospects for this trade.  Since we are buying the spread for less than the intrinsic value if the stock moves higher after the earnings announcement on February 5, we can’t lose on the upside no matter how much IV falls after the announcement, and if it falls, we will have over 5 months to sell new premium to recover from the loss.  I’m sorry we don’t have more to invest in this portfolio:

BTO 2 GMCR Jun-14 70 calls (GMCR140621C70)
STO 2 GMCR Feb1-14 80 calls (GMCR140207C80) for a debit of $9.80  (buying a diagonal)
 
Be prepared to change this price limit by $.05 or more in order to get an execution.
 
Happy trading.
 
Terry