JD has been in an ascending parallel channel since the COVID-19 peak in March and shows no sign of slowing down. I sold an October 16 2020 62.5 Put @ 1.03 near the bottom of the channel today with the idea that the uptrend will continue over the next couple months. This is one of China's biggest e-retailers and its been having a great time with extra sales due to the pandemic. Don't see any reason why that should stop anytime soon.An alternative idea for a more aggressive trade would be to sell the $70 Put for a much larger credit. The $70 Put will be just below the bottom of the channel on the Oct 16 expiration.
20-JD-01
- Opening Date: August 20, 2020
- Expiration Date: October 16, 2020
- DTE: 57
- IV: 44%
- IV Percentile: 36%
- Odds of Winning: 80%
- Win: > 61.47 @ Expiration
- Loss: < 61.47 @ Expiration
- Reg-T Margin @ Open: $720
Chart Legend
- The green area represents 100% win zone.
- The yellow area is a win, but we have to give back some of the initial credit taken in.
- The red area is loss.
- 1 SD, 2 SD, 3 SD projections from Opening Date to Expiration Date are included.
Trade closed manually
Closed this out @ $0.50 on 8/25/2020. JD went parabolic, crashing upwards, moving outside of the 3 standard deviation projection. Anytime I get a chance to take a 50% profit after just a couple days in a trade, I'll do that.Here's the final stats for this trade:
Days in Trade: 5
Credit: $53
Return on Capital 7.07%
Annual Return 14563.76%
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Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.