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SBN Options Idea for September 2021

Market Summary:

The major indices are all trading slightly higher at midday following an overnight risk rally that erased some of yesterday's steep losses. From a short-term technical perspective, the large-cap benchmarks are still wounded, but yesterday’s slightly panicky session could have marked the end of the pullback. In economic news, building permits and housing starts both came in well above the consensus estimates, with the more forward-looking former measure painting a positive picture of the sector. With still no official reaction to the Chinese credit woes, volatility could remain high in the coming days, but with fundamentals being strong and the U.S. COVID numbers being on a positive trajectory, we maintain our positive intent.

Suggested Option Trade:

Sell Puts on Interactive Brokers Group, Inc. Write(Sell) $55 Puts on IBKR expiring January 21' 2022 at $2.40 Credit

  • Trade: Sell ("sell to open") the January 21' 2022 $55 put.

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

  • Price Guidance: Aim to receive a net credit of $2.40 or so.

  • Current Stock Price: $59.40

If IBKR trades over $55 at expiration, we will keep the entire credit at a 100% profit. If it trades below $55 at expiration, we happily own the shares at a net price of $52.60 ($55 - $2.40).

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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