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January 27, 2010 7:37 EST Related Symbols: BAC
you're watching:
Mad About Options
An options-related take on Jim Cramer's latest recommendations and analysis on the latest securities and ETFs getting attention on the Street.
Will Bank of America make it? Find out Cramer’s take and potential option trades.
Mad About Options takes a look at the stocks getting coverage from Jim Cramer, Fast Money casts and other heavy hitters in the financial press and reviews strategies option traders might have used if they agree or disagree with these assessments of the underlying stocks.
The Pick – Bank of America (BAC):
On Jan. 25, Mad Money host Jim Cramer told investors he thinks BAC will make it. BAC shares were trading at $14.98 at the time of Cramer’s call.
BULLISH Option Trading Idea for BAC:
Bull put spreads –
Maximum risk: $8.40 plus commissions
Maximum potential profit: $1.60 minus commissions
Breakeven: The strategy will be profitable if BAC shares are trading higher than $14.20 at March expiration.
BEARISH Option Trading Idea for BAC:
Collar with a call spread–
Maximum risk: $4.70 plus commissions
Maximum potential profit: $10.30 minus commissions
Breakeven: The strategy will be profitable if BAC shares are trading lower than $17.80 at January expiration.
For more trading ideas and breaking news on the options market, stay tuned in to The Options News Network.
