Trade of the Day – AAPL Put Credit Spread

AAPL was trading at $502.60, an all-time high, near Monday’s close.

Trade: Selling the AAPL Jan 2013 450-400 Put Credit Spread for $16.00 total. 

Profitable: I make money on this trade if AAPL Closes above $434 on January 18, 2013.


Break-even:
 I break-even on this trade if AAPL Closes at $434 on January 18, 2013.


Unprofitable:
 This trade is unprofitable if AAPL Closes below $434 by January 18, 2013. The most I can lose on this trade is the amount the spread can be worth, $50.00 minus the amount I sold the spread for $16.00, for a total of $34.00.

Reason I like this Trade: AAPL is a beast and I am looking to get long on any dips. I do not think there is anything that can derail AAPL right now, I think either a stock split or a dividend would make the stock rally even higher.  The IPad 3 should be awesome with a new HD screen, lighter, and faster.  Then there will be a possible Macbook Pro upgrade this year with possibilities of a new Iphone and AAPL TV.  This is more of a position than a trade, so I will not be looking to take any partial profits, just add more if the stock sells off.  Also, watch out for the possible IBrick this year.  

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

 
Regards,

Andrew Keene

KeeneOnTheMarket.com