TLT Big Lizard, Neutral to bullish.
Selling the 116 Straddle and buying the 118 Call for a total of $2.33 Credit.
We have no risk to the upside and we are betting the Rate change is already priced in and if something strange happens and we get a move higher we don't have any risk to the upside.
Our break even is at $113.67
That's 2.5% protection move to the downside. Last two times we had a rate change we had a move of 1.6% and 1.7%.
With 39 days to expiration, we have a 74% probability to make money in this trade.
We have no risk to the upside and we are betting the Rate change is already priced in and if something strange happens and we get a move higher we don't have any risk to the upside.
Our break even is at $113.67
That's 2.5% protection move to the downside. Last two times we had a rate change we had a move of 1.6% and 1.7%.
With 39 days to expiration, we have a 74% probability to make money in this trade.
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