Bull Call Spread in CHWY.
music selection: “Funkytown” — Lipps Inc.
First cleanup. A bull spread in WMT expired in the money over the weekend. I earned $400 on $1,600 capital at risk over 40 days. That is good for a 25% nominal return or 228% annualized.
The recent three days of market turmoil took a sure thing in Amazon and put it deeply at risk. With only 11 days of trading left till expiry and needing 4% upside to earn my profit, I decided to cut bait and run. I had $900 at risk. I took a 91 dollar loss on my AMZN bull call spread over 58 days.
My new position is in Chewy (CHWY). This is an online pet food, supplies, and toys provider. With corona keeping people away from the pet superstores business is booming. The company also has a subscription box program so will likely see some recurring revenue from the uptick in sales. It is one of the few names that continues climb while the market corrects from the recent all time high. I bought the 60/65 bull call spread with 16OCT2020 expiry. The trade will be in force for about 39 days. I took a net debit of $2.00. Should shares rally 4.59% over the 39 days the full profit will be earned. That is good for 150% or 1,404% annualized.
Devour your prey raptors!