Hey guys,
I am trading TROW stock with a long call vertical spread to take advantage of leverage with limited risk and greater profit potential. For example, I am buying a vertical call by buying the 105 call and selling the 115 call, October 19th 2019. This is a 10.0 dollar move which equals 1,000$ profit - how much I pay for the option (4.19 per contract =419$ investment). My max risk is 419$ and my max profit is 581$. My option expires October 19, 2019 and is good way to take advantage of time with larger potential profit (123% potential) as long as the stock stays above 109.19$; The stock has to make a 3.9% move in our direction (going up). This is considered low risk as it could easily reach 4-5% within 1-2 months from here.
The upward wedge technical makes me think that stock should be making steady gains in the next 1-2 months.
I am trading TROW stock with a long call vertical spread to take advantage of leverage with limited risk and greater profit potential. For example, I am buying a vertical call by buying the 105 call and selling the 115 call, October 19th 2019. This is a 10.0 dollar move which equals 1,000$ profit - how much I pay for the option (4.19 per contract =419$ investment). My max risk is 419$ and my max profit is 581$. My option expires October 19, 2019 and is good way to take advantage of time with larger potential profit (123% potential) as long as the stock stays above 109.19$; The stock has to make a 3.9% move in our direction (going up). This is considered low risk as it could easily reach 4-5% within 1-2 months from here.
The upward wedge technical makes me think that stock should be making steady gains in the next 1-2 months.