10-22-2013, 05:55 AM
These are Bull spreads where the writer will profit up to the $105 strike price where the upper calls were written. This strategy limits downside loss bc the $105 calls help pay for the $80 calls and profit is only "given up" if the stock breaks through the $105 level.
My guess is that the $105 level was used bc this is roughly the 52 week high on the stock. This could also be a short hedging out some SD risk for Nov/Dec without having to close out the shorts
Just my initial thoughts
My guess is that the $105 level was used bc this is roughly the 52 week high on the stock. This could also be a short hedging out some SD risk for Nov/Dec without having to close out the shorts
Just my initial thoughts