NaughtyPines

TRADE IDEA: VRX NOV 18TH 17.5 SHORT PUT

NYSE:VRX   VALEANT PHARMACEUTICALS INTL I
Okay, so there's other "big pharma" that I like wayyy better than Valeant (e.g., BMY             , GILD). The problem is that BMY             and GILD are more expensive and don't have the implied volatility that VRX             has (for obvious reasons: they don't have as many "warts" as VRX             ).

Nevertheless, I'm watching VRX             here because its implied volatility is so high (>100%), which makes relatively far out-of-the-money short puts comparatively rich in premium.

Here, I'm eyeing the 17.5 short puts for obvious reasons -- that strike is below historic lows for this poo pile. Moreover, with an implied vol             of >100%, I can get .83 ($83) in credit per contract "at the door," which makes it quite attractive for an underlying at this price. The notion here would be to either (a) keep the premium; or (b) get put the shares at 17.5, after which I would sell calls against (covered call).
Ideas Scripts Chart
United States
United Kingdom
India
España
Italia
Brasil
Россия
Türkiye
日本
한국
Home Stock Screener Economic Calendar How It Works Chart Features House Rules Moderators For the WEB Widgets Stock Charting Library Priority Support Feature Request Blog & News FAQ Help & Wiki Twitter
Private Messages Chat Ideas Published Followers Following Priority Support Public Profile Profile Settings Billing Sign Out