Trade of the Day

Trade: I bought the FTR May 4 Strike Call for $0.55. 


Profitable:
 I make money on this trade if FTR Closes above $4.55 by May 18, 2012.


Break-even:
 I break-even on this trade if FTR Closes at $4.55 by May 18, 2012.


Unprofitable:
 This trade is unprofitable if FTR Closes under $4.55 by May 18, 2012. The most I can lose on this trade is the amount I paid for these Calls, $0.55.

Reason I like this Trade: I love this trade. FTR (Frontier Communications, $4.29) options have been trading heavily. A year ago, FTR was trading above $9.00 per share. I recently saw a customer sell 25,000 Feb 4 Puts for $.15. I think it may be time to jump on board with a limited-risk, bullish position.  I want to get LONG, but I want more time, not just until February. By buying the May 4 strike calls at $0.55, I have almost four months with these Calls, and they are currently $0.29 in-the-money. I feel very confident with the risk and potential profit of this trade. 

Please feel free to email me with any questions at  andrew@keeneonthemarket.com.

 
Regards,

Andrew Keene

KeeneOnTheMarket.com