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SBN Options Idea for October 2021

Market Summary:

The major indices are all trading modestly higher at midday following a busy morning of corporate earnings on Wall Street. Johnson & Johnson (JNJ), Procter & Gamble (PG), and Philip Morris (PM) all beat on their top and bottom lines, but the market’s reaction has been mixed, with only the shares of J&J getting a sizable post-earnings boost. That said, the broad-based S&P 500 rode the wave of bullish earnings, hitting an over one-month high and topping the crucial 4,500 level, with its all-time high now being within 1%.

Suggested Option Trade:

Call (Bull) Debit Spread on Ulta Beauty Inc. Establish Bull Call Spread on ULTA expiring December 17' 21 at $10 Net Debit

  • Trade:

Buy 1- December 2021, $365 strike call for $29.20


Sell 1- December 2021, $385 strike call for $19.20

  • Allocation: Size the position according to your portfolio size and how much you're comfortable investing.

  • Price Guidance: Net debit of $10 or so.

  • Current Stock Price: $376

If ULTA trades over $385 at expiration, we will make a 100% profit. If it trades below $365 at expiration, we will incur a 100% loss. If it trades between the 2 strike prices, we will make a partial profit or loss. Be sure to close the trade before or closer to expiration!

You will need to manage the trade till expiration or closure yourself, and no further guidance will be issued. If you need any help, you may reach out to us. Disclaimer: Options trading involves substantial risk. The valuation of stock and options may fluctuate, and as a result, in some cases, members could lose more than their original investment. In no event should the content of this correspondence be construed as an express or an implied promise, guarantee or implication by StockBuzzNow that you will profit or that losses can or will be limited in any manner whatsoever. Past results are no indication of future performance. No guarantee of any kind is implied or possible where projections of future conditions are attempted.

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