Breakdown: I sold the Google, October 14th (Weekly, expires tomorrow) 580-585 Call Spread and 530-525 Put Spread for $3.10 total.
Profitable – I make money on this trade if GOOG closes between $526.90-$583.10 by the close of trading tomorrow, October 14st, 2011.
Break-even – I breakeven on this trade if GOOG closes at $526.90 or $583.10 by tomorrow.
Unprofitable – If GOOG makes a huge movement on earnings and closes below $526.90 or above $583.10 I can lose $1.90 on this trade.
The reason I like this trade: Google (~ $555) moved $70 on earnings last quarter, but I do not think it will make a huge movement today after the close. In this spread, I am fading the move and hoping for a movement of less than ~$27 in either direction. I like this spread because I am risking $1.90 to make $3.10 and all I need is GOOG not to move more than $27 in the next 24 hours.