9/30/13 -Open
With JCP down -35% in the past 2 weeks, and dipping below $9 for the first time in 13 years it's time to buy into weakness.
The IV is 101% with a recent range of 48-116%. That places the current IV in the 78%-tile (101-48)/(116-48). So we'll collect some of the inflated premiums in the puts and use the credit to help finance a LEAP.
- JCP @8.81
- BTO +10 Jan 11 C
- STO -10 Nov 8 P
- Debit = 0.16 * 10 = $160
