Options Trade Alert on Salesforce.com
Target: Salesforce.com(CRM) trading at $147.83
Commit Criteria: CRM Implied Volatility is overpriced relative to its forecast volatility of 9.81% over the trade period. We are looking for possible price movement but for it to stay within its $130 to $165 price range until the exit of this trade.
Tactic: Opening 10 CRM June 2012 Iron Condors (strikes
Tactical Employment of Iron Condor:
We will be watching for a price movement near the short strikes. As the short strikes are threatened, we will adjust the Iron Condor as necessary.
We don't want trade expectancy dropping below 2%. Based on this we have two price targets at which we need to consider an adjustment. CRM trading below $138.55 and above $152.47 are triggers for adjustment.
We will wait for this Iron Condor to expire worthless taking the $1150 credit as profit.
Exit Tactic: We will wait for this Iron Condor to expire worthless in the Advanced Model Portfolio, adjusting as necessary.