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Mike Khouw's Alibaba Trade

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Mike Khouw suggested on CNBC's "Options Action" a bullish options strategy in Alibaba Group Holding Ltd (NYSE: BABA), which reports earnings Thursday.

Khouw wants to sell the November 3 expiration, 162.50 strike put for $1.25 and buy the November 3 expiration, 175/182.50 call spread for $3. The options structure would cost him $1.75 and he can maximally make a profit of $5.75, in case the stock jumps to $182.50 or higher at Friday expiration.

 

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Posted-In: CNBC Mike Khouw Options ActionOptions Markets Media Trading Ideas