Kevin Kelly recommended on Bloomberg Markets a long position in Home Depot Inc HD. The stock traded lower after earnings results, but Kelly believes the report was good and that the management couldn't have done anything better.
He wants to make a bullish bet in the name and he wants to use options to do so. Kelly suggested that traders with a long position should sell the stock, buy the January 150 call for $6.50 and sell the January 145 put for $5.50. The risk reversal would cost him $1 and it breaks even at $151 or 0.55 percent above the closing price on Tuesday. If the stock closes below $145 on January expiration, Kelly is going to have to buy the stock at $145 and his total entry price is going to be $146.
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Date of Trade | ticker | Put/Call | Strike Price | DTE | Sentiment |
|---|
Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.
