We've gotten some questions of late about how to trade the AMC squeeze, and while we don't have any position, we have a simple, defined risk trade here that we would consider taking if triggered.
If it closes green today, and gaps up tomorrow, we would strongly look at buying some ATM Aug Puts. No matter what happens here, it's clear that fair value for this company is around $4 especially with the increased float, and so paying the premium to short these 79 days out with a cost basis near 30-35 seems like a solid deal. Obviously the trade cost is very high, but there's no other way to short this with limited risk. 2:1 trade with high risk but a decent likelihood of a win by expiration.
Cheers!
If it closes green today, and gaps up tomorrow, we would strongly look at buying some ATM Aug Puts. No matter what happens here, it's clear that fair value for this company is around $4 especially with the increased float, and so paying the premium to short these 79 days out with a cost basis near 30-35 seems like a solid deal. Obviously the trade cost is very high, but there's no other way to short this with limited risk. 2:1 trade with high risk but a decent likelihood of a win by expiration.
Cheers!
Ghi chú
just pulled the trigger on some $50 aug puts. Cost basis is short from 28, 80 days from now.Ghi chú
just took half off for a 15% gain due to the increase in IV. holding the rest for the long term idea.
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seekingalpha.com/author/propnotes/analysis
Click here ⬇
seekingalpha.com/author/propnotes/analysis
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Want more high probability trade ideas?
Click here ⬇
seekingalpha.com/author/propnotes/analysis
Click here ⬇
seekingalpha.com/author/propnotes/analysis
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Thông báo miễn trừ trách nhiệm
Thông tin và ấn phẩm không có nghĩa là và không cấu thành, tài chính, đầu tư, kinh doanh, hoặc các loại lời khuyên hoặc khuyến nghị khác được cung cấp hoặc xác nhận bởi TradingView. Đọc thêm trong Điều khoản sử dụng.