This AI play has bottomed and is breaking out, according to options trader Zhang. How to play it

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This AI play has bottomed and is breaking out, according to options trader Zhang. How to play it

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. The trade With implied volatility on the higher end, options premiums are elevated. To reduce the cost of buying upside exposure, I’m suggesting that we buy a Dec $105/$120 call vertical @ $5.40 Debit. This entails: Buying Dec $105 Calls @ $6.90 Selling Dec $120 Calls @ $1.50 This call vertical spread offers a maximum potential reward of $960 per contract if AKAM is above $120 at expiration, with a maximum risk of $540 if AKAM is below $105 at expiration, yielding a potential reward-to-risk ratio of 1.8. DISCLOSURES: (Zhang has position in AKAM) All opinions expressed by the CNBC Pro contributors are solely their opinions and do not reflect the opinions of CNBC, NBC UNIVERSAL, their parent company or affiliates, and may have been previously disseminated by them on television, radio, internet or another medium. THE ABOVE CONTENT IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY . THIS CONTENT IS PROVIDED FOR INFORMATIONAL PURPOSES ONLY AND DOES NOT CONSITUTE FINANCIAL, INVESTMENT, TAX OR LEGAL ADVICE OR A RECOMMENDATION TO BUY ANY SECURITY OR OTHER FINANCIAL ASSET. THE CONTENT IS GENERAL IN NATURE AND DOES NOT REFLECT ANY INDIVIDUAL’S UNIQUE PERSONAL CIRCUMSTANCES. THE ABOVE CONTENT MIGHT NOT BE SUITABLE FOR YOUR PARTICULAR CIRCUMSTANCES. BEFORE MAKING ANY FINANCIAL DECISIONS, YOU SHOULD STRONGLY CONSIDER SEEKING ADVICE FROM YOUR OWN FINANCIAL OR INVESTMENT ADVISOR. Click here for the full disclaimer.

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#play #bottomed #breaking #options #trader #Zhang #play

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