While the Diary of a Mad Hedge Fund Trader focuses on investment over a one week to the six-month time frame, Mad Day Trader, provided by Bill Davis, will exploit money-making opportunities over a brief ten minute to three-day window. It is ideally suited for day traders, but can also be used by long-term investors to improve market timing for entry and exit points.
Today, I am going to suggest a trade on a stock we traded in the past. And that stock is SNAP.
However, unlike the last time I suggested it, I am not going to suggest you buy the stock.
Instead, I am going to suggest a short term debit spread.
Here is the suggest:
Buy to Open December 20th - $14.00 call for $0.44
Sell to Open December 20th - $15.00 call for $0.11
The net debit will be 33 cents per spread with a maximum value of $1.00.
In other words, the return would be 2 to 1 if SNAP moves above $15 by next Friday.
Because this is a short term position, I suggest you limit the trade to a 12 lot or .04% of the portfolio.
