TERP

  • Posted by on November 20th, 2014 at 12:23 am

11/19:

Recent IPO $TERP broke out to new all-time highs yesterday on it’s highest volume since its debut back in July, which caught my attention:

Screen Shot 2014-11-19 at 10.12.26 PM

 

Today, the stock digested and consolidated yesterday’s move and offered some attractive premiums at the 30 strike to sell puts. My offer to Dec 30 puts at $1.10 was hit and I was later able to get hit on a bid to purchase Dec 35 calls at 80 cents, leaving me a nice credit cushion to start off this risk-reversal trade.

So, the game plan is to play defense if the position trades south of $30. If the stock holds here and/or goes higher, there’s nothing to do but sit on my hands and let it play out.

My position:

short Dec 30 puts
long Dec 35 calls
net credit: 30 cents
 

~

 

 

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