Monday, December 26, 2011

Bear Put Spread (27 Dec 11): TLT

Look for a bearish market where you anticipate a modest decrease in the price of the stock below the strike price of the short Put option.

TLT  $118.27
Buy to Open (1) Jan 12 121 P @ $4.25
Sell to Open (1) Jan 12 116 P @ $1.45 
Net Debit: $2.80 ($280.00)
Breakeven: $118.20
Max. Profit: $220.00
Pct Return: 78.6% (25 days)

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