Dan Nathan's Bearish McDonald's Trade

Speaking on CNBC's "Options Action", Dan Nathan suggested that investors should consider a bearish options strategy in McDonald's Corporation MCD ahead of earnings.

The company is going to report earnings on Tuesday and Nathan thinks it would be a good idea to buy the July 152.50/149 put spread for $1 in the name. The trade breaks even at $151.50 or 1.57 percent below the current stock price and it can maximally make a profit of $2.50. The stock has to drop at least 3.2 percent by the end of the week for the trade to reach its maximum profit.