TWLO Analysis

Twilio Inc. (TWLO)

Update 4/26/2019: I exited TWLO profitably with a $1.84 debit, 21 days prior to expiration. The profit was 12% of its maximum potential, far short of my 50% target. The position produced a return of $0.25. Shares closed at $132.31, within the profit range.

Shares rose by 5.2%, or $6.49, over 15 days, a $126% annual rate. The options position produced a 13.6% return for a 331% annual rate.

I have entered a short iron condor spread on TWLO, using options that trade for the last time 36 days hence, on May 17. The premium is a $2.09 credit and the stock at the time of entry was priced at $125.82.

The implied volatility rank (IVR) stands at 55.

Premium: $2.09 Expire OTM
TWLO-iron condor Strike Odds Delta
Long 165.00 93.8% 9
Break-even 157.09 91.1% 12.5
Short 155.00 88.3% 16
Short 100.00 81.3% 13
Break-even 92.09 85.5% 10
Long 90.00 89.7% 7

The premium is 20.9% of the width of the position’s wings.

The risk/reward ratio is 3.8:1.

By Tim Bovee, Portland, Oregon, April 11, 2019


Tim Bovee, Private Trader tracks the analysis and trades of a private trader for his own accounts. Nothing in this blog constitutes a recommendation to buy or sell stocks, options or any other financial instrument. The only purpose of this blog is to provide education and entertainment.

No trader is ever 100 percent successful in his or her trades. Trading in the stock and option markets is risky and uncertain. Each trader must make trading decisions for his or her own account, and take responsibility for the consequences.

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