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PPDI Earnings : Flat (Profit 1.06%)

Published on April 18, 2007

PPDI Earnings : Flat (Profit 1.06%)

April 18, 2007

I invested in the PPDI. There was huge gyrations in the stock today but I was able to close this trade for slight profit. That’s the beauty of playing backspread for earnings.

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It was able to absorb huge move. This trade had opportunity to earn more if I would have placed the order at mid point for my short call that I mistaken bot back straight (mid was $1.60 vs wrongly placed ask at $1.75).

Opened – Short 1 32.5 call (@2.52) and Long 2 35 calls @ 0.95, Net credit =$0.62/spread
Closed – Bot back 32.5 call for 1.75 and sold 35 calls for $0.575 = Debit =$0.60/spread; Profit = $2 on $188 investment i.e. 1.06% profit.

Profitable trading, OptionPundit

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