Creating a synthetic position in ISRG using LEAPS
Listen to Options Playbook Radio 192: Taking a LEAP with ISRG
In this episode, we are looking beyond the Options Playbook and are selling a put credit spread to pay for a long call. You can find more on p. 76 of The Options Playbook, which is always available on OptionsPlaybook.com, in on the Amazon Kindle edition.
Specifically:
- Looking at Intuitive Surgical, Inc. (ISRG), which has been on a tear lately
- Earnings pushed the stock even higher
- Expensive underlying = expensive options
- Taking a long view using LEAPS
- Selecting strikes for the put spread
- Buying the at-the-money call
- How does the trade work?
- What is the cost?
- What is the risk?
- How to close it out?
- Alternatives to the trade as described
Do you have a question that you want answered on a future episode? Send them to Brian at theoptionsguy@invest.ally.com, or to the Options Insider at questions@theoptionsinsider.com.