A trader bought the September $52.50 call and sold the September $45 put 3,600X at $0.01 debit, $21,600 total. Risk is limited to the total debit of $21,600. Profit potential is unlimited.
It seems that this investor is looking for lows near $47 to hold as a possible double bottom and for a nearly $3 bounce to the upside to break even. The daily chart below depicts the possible double bottom formation and a horizontal line that indicates the $52.50 break even point for the trade.
HSBC (HBC) has been a bank under pressure with weak earnings and concerns on the European debt crisis. The company has also announced massive job cuts. Shares trade 14.75X earnings, 1.13X book and 2.4X cash with a 3.7% dividend yield.
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