Option Trade: Gain Bullish Exposure To DocuSign With A Bull Put Spread | Summary and Q&A

405 views
July 21, 2021
by
Investor's Business Daily
YouTube video player
Option Trade: Gain Bullish Exposure To DocuSign With A Bull Put Spread

TL;DR

Docusign is showing strong performance and traders can consider a bull put spread strategy to capitalize on the stock's strength.

Install to Summarize YouTube Videos and Get Transcripts

Questions & Answers

Q: What is a bull put spread strategy?

A bull put spread strategy involves selling an out-of-the-money put option and buying a further out-of-the-money put option. It is a bullish strategy that aims to profit if the stock remains above a certain price level.

Q: What are the strike prices used in this bull put spread strategy?

The strategy involves selling the 290 put option and buying the 285 put option for Docusign stock.

Q: How much option premium can the trader receive from this bull put spread?

The spread was trading for around $1.65, which means the trader receives $165 in option premium for the trade.

Q: What is the maximum risk for this bull put spread strategy?

The maximum risk is approximately $335, which represents the potential loss if the stock closes below $285 on the expiration date.

Summary & Key Takeaways

  • Docusign is displaying impressive relative strength, with high ratings in RS, composite, and EPS.

  • The stock recently broke out above resistance to reach a new high.

  • Traders can execute a bull put spread strategy to take advantage of the stock's continued strength.

Share This Summary 📚

Summarize YouTube Videos and Get Video Transcripts with 1-Click

Download browser extensions on:

Explore More Summaries from Investor's Business Daily 📚

Summarize YouTube Videos and Get Video Transcripts with 1-Click

Download browser extensions on: