buy +1 August 2015 $216 call at $1.25
sell -1 August 2015 $215 call at $1.61 (27% prob ITM)
sell -1 August 2015 $203 put at $2.18 (30% prob ITM)
Why did I place this trade?
- stochastics in "overbought" region
- if SPY closes between $203 and $215, profit = $254
- if SPY closes above $216, profit = $154 (fine)
8/13/2015 (12:26:36 pm, PT)
buy (to close) 1 August 2015 $215 call at $0.02 (to remove the risk)
8/18/2015 (9:50:44 am, PT)
buy (to close) 1 August 2015 $203 put at $0.05 (to remove the risk)
8/21/2015 (expiration)
the long $216 calls expired "worthless"
NET PROFIT: $237.56
Success!
THANK GOD I bought back those short puts early because they would have ended up ITM on Expiration Friday (8/21/2015). SPY closed at $197.63 on expiration.
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