BEN December Bull Put Spread
Written by 1option
Watching Franklin Resources (BEN) for a possible bounce off the lower trendline of the rising channel. In order to avoid time decay, we are looking at a possible December 110/105 Bull Put Spreads. The position will sell the 110 put and buy the 115put for downside protection. The current R/R on the trade is $370 and the reward is $130, which is 35% ROE in 23 days. The breakeven at expiration is $108.71 on the underlying. Of course, with BEN trading in the $112 area, a fail of the lower trendline would need to be used as a tight stop.
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Last week unfolded just as expected as we got a head fake early on that stalled perfectly in the 1100 area on the SPX. Stocks then completely collapsed into the end of the week before reversing...
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