nomadic_m
01-25
$GameStop(GME)$ Bull Call Spread

Current price of GameStop: $28.3
Assuming the investor believes GameStop will rise to $35 within a month

Buy a call option with a strike price of $29, costing $290
Sell a call option with a strike price of $35, generating $115 in income

Net initial cost: $290 - $115 = $175
Maximum risk: $175 (initial investment)
Maximum profit: $425

This strategy is suitable when the investor expects the stock price to rise to a specific range ($35 in this case) but not exceed the higher strike price.

Strategy details:

Buy call option
Strike price: $29
Option cost: $290

Sell call option
Strike price: $35
Option income: $115

Net initial cost: $175
Maximum risk: $175
Maximum profit: $425

Advantages:

- Limits risk and reduces initial cost
- Captures upside potential with fixed profit at higher strike price

Disadvantages:

- No profit from additional upside beyond $35

πŸ’° Stocks to watch today?(3rdΒ Feb)
1. What news/movements are worth noting in the market today? Any stocks to watch? 2. What trading opportunities are there? Do you have any plans? 🎁 Make a post here, everyone stands a chance to win Tiger coins!
Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.

Comments

  • Kiwi_G
    01-26
    Kiwi_G
    yes demo before earnings. πŸ‘πŸ»would not be comfortable picking a strike and date otherwise in current mkt would def have to tag team thoughts! or see what others have locked in. will see if i have the time to working it all out / on the app before earnings x πŸ’«
    • nomadic_m:Β 
      happy earnings! win big!
      enjoy your weekend πŸ–οΈπŸ©΄πŸ˜Ž
  • Kiwi_G
    01-25
    Kiwi_G
    Love the simplicity NM πŸ‘ for those new to options. Now, to just work out how to do on app and find a stock fitting that pattern 😳🀣Great post πŸ€ πŸ€ 🎲 🎲 🧑
    • nomadic_m:Β 
      try with TSLL. use demo account. I'm going to try out before earnings
  • Barcode
    01-25
    Barcode
    Nice one nm, easy to follow for newbies especially! πŸ€πŸ€πŸ€
    • BarcodeReplynomadic_m:Β 
      Morena nm β˜•οΈβ˜•οΈβ˜•οΈ Right back at ya! An exciting week of earnings ahead! πŸ’°πŸ’°πŸ’°πŸ€πŸ€πŸ€
    • nomadic_m:Β 
      thanks bc. happy earning! 😁🎊😁
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