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Friday, January 4, 2013

February 2013 $SPX Bear Call Spread

SELL 5 SPX 1520 Feb. 2013 CALL (@3.75)
BUY 5 SPX 1525 Feb. 2013 CALL (@3.10)

Credit: $0.65 (0.65 * 100 * 5 = $325)
Margin: $4.35 (4.35 * 100 * 5 = $2175)


Break-even point: 1520.65 (Around 1462 when I opened the trade)
Probability of success: 79.00% when the trade was opened
Days to expiration: 42
Max return on margin: 14.94%
Commissions: $15.00 (Assuming a very unfavorable $1.50 per contract)

With 88% of stocks above their 20 SMA, Stochastics and McClellan overbought, I'm selling this spread betting that SP won't hit 1520 by February 15.

Below is the chart of SPX at market close for future reference.

(Click on image to enlarge)


Check out Track Record for 2013

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