Earnings Beat – AAPL Trade
Good day Insiders,
Apple Inc is set to report earnings post the close today and there is endless speculation on where the stock is going. Personally, I am of the opinion that AAPL does not move all that much. Everyone is speculating “Earnings are going to be horrific because of lower iPhone sales.” Yes, this very well could be true but if we look back as to when the information was made public, AAPL took it on the chin worse than Clubber Lang in Rocky III, so in all likelihood, we could easily see movement, in the form of an overreaction followed by calmer buyers stepping in, but we are going to cover all bases here just in case we get movement one way or the other. We will be placing 3 pieces to the trade, the buying of an unbalanced condor, the selling of a put spread and the buying of a call spread.
Remember, we are buying the unbalanced condor, selling the put spread and buying the call spread.
Risk & Reward
The entire trade will use $7,500 in margin and give up protection on the downside to the 137 price level. For those position sizing, adjust the quantity of the condor and put spread as those are the biggest contributors to your use in margin here. Given they are the same quantity, if you are adjusting put spread first, adjust the unbalanced condor by the same amount.