After the Q4 2020 beat, Chemours jumped higher. CEO Mark Vergano: “Our COVID-19 response plan enabled Chemours to deliver robust Free Cash Flow as we prioritized cash and liquidity in a challenging demand environment. As the recovery gained momentum, we were ready to safely serve our customers and delivered fourth quarter sales performance nearly equal to pre-pandemic levels.” Good for us, the options traders. So let’s check this opportunity, folks.
Disclaimer:
The information I am giving you in this article is for informative purposes only and should not be treated as investment advice. The information presented would not be suitable for investors who are not familiar with exchange traded options. Any readers interested in trading activities related to the information in this article should do their own research and seek advice from a licensed financial adviser.
Type of a trade: Cash secured put (in the money)
Alternatively: Bull put spread
Expiration: 16th April (42 days)
Strike: $27
Premium for 1 option: between $220 and $240 on the day this article was published
Margin: apprx. $460 on the day this article was published
Pros for this trade:
– A long signal (I’m using the ADX-Indicator), giving a higher probability that the price would stay above the strike in the next 42 days
– A dividend of 3.88% on the day the trade idea was published, in case the price would fall below the strike and you would get the stock assigned (Source: finviz.com)
Cons for this trade:
– Low IV Rank and IV Percentile
– The long signal could turn out as a flash in the pan
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Result of this trade: t.b.a.
Realized profit for 1 option: t.b.a.
Days in the trade: t.b.a.
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