[Opening Bullish Spread on Apple (AAPL)]
Dear Member:
Apple (AAPL) continues to climb on the heels of its newest success, the iPhone which I hear is fantastic. I am opening a bullish put spread on AAPL with only 15 days to expiration, I am placing a day order simultaneously to buy to open the Aug 120 calls (QAATD) and sell to open the Aug 125 calls (APVTE) at a limit of a combined credit of 60 cents. The stock price would have to fall below the 50 day exponential moving average before I would have to make any adjustment and if no adjustment becomes necessary, and the stock stays above $125 until expiration (currently trading around $135)I would have a 13.6% return on risk before commissions in just over two weeks.
DISCLOSURE: At the time of publication, I have a bullish call spread with LEAPS on AAPL.
Sincerely,
Bill Kraft
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