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J. C. Penney Company, Inc. Message Board

  • thedarthxander thedarthxander Aug 23, 2013 2:53 PM Flag

    Big trader's put spread - question from noob

    Remember the CNBC article from earlier this month that talked about two big options trades? One of the trades involved a calendar put spread per the article:

    One trader made a bearish move on Tuesday by buying a calendar put spread. One big trader sold the Aug. 12-strike puts that expire next week, and bought the weekly 12-strike puts that expire on Aug. 23. The trader bought the spreads for 46 cents a piece, and appears to be expressing a nuanced opinion on the stock.

    In short, the trader appears to believe that J.C. Penney shares will hold above $12 over the next 10 days, but then fall below that level in the week that follows.

    My question: obviously this trader got the first part right and the second part wrong. Did the trader make any money on this trade or is it a complete bust because of the second leg?

    Sentiment: Strong Buy

 
JCP
9.32+0.06(+0.65%)Sep 2 4:01 PMEDT