Novo Nordisk A/SLong
Opening (IRA): NVO March 28th 76 Covered Call
... for a 74.50 debit.
Comments: Taking what amounts to a modest directional shot with a break even below the 52-week lows, selling the -75 delta call against shares to emulate the delta metrics of a 25 delta short put, but with the built-in defense of the short call.
Metrics:
Buying Power Effect/Break Even: 74.50
Max Profit: 1.50
ROC at Max: 2.01%
50% Max: .75
ROC at 50% Max: 1.00
Will generally look to take profit at 50% max and/or roll out the short call if my take profit isn't hit by expiry.
Comments: Taking what amounts to a modest directional shot with a break even below the 52-week lows, selling the -75 delta call against shares to emulate the delta metrics of a 25 delta short put, but with the built-in defense of the short call.
Metrics:
Buying Power Effect/Break Even: 74.50
Max Profit: 1.50
ROC at Max: 2.01%
50% Max: .75
ROC at 50% Max: 1.00
Will generally look to take profit at 50% max and/or roll out the short call if my take profit isn't hit by expiry.
Note
There is a 3/31 dividend to be had here of approximately 1.10, so I'm going to attempt to grab it, and I have to be a shareholder of record on 3/31 in order to do that. Rolling the March 28th 76 down to the April 17th 75 (there are only five wides available in April) for a 1.10 credit (a credit that exceeds that amount of strike destruction, so that I'm not giving up the max profit of the setup). 73.40 break even with a max of 1.60 (excluding dividends).
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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.