Costco Lost $100 Billion in 4 Days. This $765 Trade Bets It All Comes Back by Friday. [Ke7UE99PqsO]
Costco hit $1,100 and then dropped $100 in four trading sessions. Earnings are Thursday after the close. The implied move is only 3.5%. Mike is buying the rally. The structure: buy the June 1050 call for $1,200 and sell the three-day 1050 call against it for $330, knocking almost 30% off the cost basis before the announcement even happens. If Costco rallies 20 to 50 points into earnings, the trade works. If it sells off, he rolls the short leg and keeps the long alive. Defined risk, low debit, and a clear management plan if things go wrong. Helpful links: tastylive: Get Tom's pre-market analysis every morning: tastylive.com/newsletters FREE Options Strategy Guide: Follow tastylive on X: SHORT: 00:00 Costco Down $100 in Four Days 00:34 Earnings May 28th: Implied Move Only 3.5% 01:00 Why the Implied Move Still Accounts for Most of June Vol 01:49 Calendar Spread at the 1050 Strike: The Setup 02:11 Sell the Three-Day Call for $330: 30% Cost Basis Cut 03:09 Even After a 10% IV Crush, This Could Be a $1,000 Winner 03:37 Why Mike Thinks Costco Posts a Decent Quarter 04:02 If It Sells Off: Roll the Short Leg and Stay in the Trade 04:15 Ideally a 20 to 50 Point Rally Makes This Work Perfectly #optionstrading #costcostock #calendarspread #optionsforbeginners #howtotradeoptions #earningsoptions #livetrading #definedrisk #optionsstrategy #tastylive tastylive is a real financial network, producing hours of live programming every day. Follow along as our experts navigate the markets, provide actionable trading insights, and teach you how to trade. With over 120 original segments, and over 25 personalities, we’ll help you take your trading to the next level, whether you are new to trading or a seasoned veteran. tastylive content is created, produced, and provided solely by tastylive, Inc. (“tastylive”) and is for informational and educational purposes only. It is not, nor is it intended to be, trading or investment advice or a recommendation that any security, futures contract, digital asset, other product, transaction, or investment strategy is suitable for any person. Trading securities, futures products, and digital assets involve risk and may result in a loss greater than the original amount invested. Investment information provided may not be appropriate for all investors and is provided without respect to individual investor financial sophistication, financial situation, investing time horizon or risk tolerance. Options, futures, and futures options are not suitable for all investors. Prior to trading securities, options, futures, or futures options, please read all applicable risk disclosures, including, but not limited to, the Characteristics and Risks of Standardized Options Disclosure and the Futures and Exchange Traded Options Risk Disclosure Statement found at Past performance is not indicative of future results. Performance is not presented net of all commissions, fees, and expenses. Multi-leg option strategies incur higher transaction costs than single leg trades as they involve multiple commission charges. Examples provided are for illustrative, informational, and educational purposes only and are not intended to be reflective of results you can expect to achieve. Supporting documentation for any claims (including claims made on behalf of options programs), comparisons, statistics, or other technical data, if applicable, will be supplied upon request. tastylive, through its content, financial programming or otherwise, does not provide investment or financial advice or make investment recommendations. tastylive is not a licensed financial adviser, registered investment adviser, or a registered broker-dealer.