Wednesday, August 17, 2011

Trade of the Day: Emerging Markets (EEM) September $45/$42 bull risk reversal

The Trade
Trader executed September $45/$42 bull risk reversal 10,000x for a credit of $1.45, $1,450,000. Maximum risk is similar to going long at $40.55. Profit potential is unlimited.

The trade is bullish, looking to capitalize on recent market weakness and for a sustained move above $40.55 to break even. Chart below marks break even point for the trade.

*Special thanks to Option Radar, BMO Capital, MEB Options, Bloomberg, Reuters, Optionistics, LiveVolPro, CBOE, AMEX, Option Monster, T.O.P. group, and all of the options desks and traders we work with to provide the option flow!

No position at this time. Position declarations are believed to be accurate at time of writing but may change at any time and without notice.

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