iShares China Large-Cap ETF (FXI)

Lot 2

Update 9/15/2021: I exited my bear call spread position on FXI 30 days before expiration, for a $0.28 debit per contract/share, a profit before fees of $54.00 per contract. Shares were trading at $40.06, down $1.44 from the entry level. 

The Implied Volatility Rank at exit was 27.1, down 13.9 points from the entry level.

My decision to exit was based on the debit on the contracts having reached about half of maximum potential profit.

Shares declined by 3.5% over 12 days for a 106% annual rate. The options position produced a 96.4% return for a 2,933% annual rate.

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I have entered a short bear call spread on FXI, using options that trade for the last time 42 days hence, on October 15. The premium is a $0.55 credit per contract share and the stock at the time of entry was priced at $41.50.

The implied volatility rank (IVR) stands at 41.0%.

Premium:	$0.55	Expire OTM
FXI-bear call spread	Strike	Odds	Delta
Calls
Long	46.00	92.0%	10
Break-even	43.55	81.0%	21.5
Short	43.00	70.0%	33

The premium is 36.7% of the width of the position’s wing.

The profit zone covers a 4.9% move to the upside.

The risk/reward ratio is 4.5:1, with maximum risk of $245 and maximum reward of $55 per contract.

By Tim Bovee, Portland, Oregon, September 3, 2021

Disclaimer

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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Based on a work at www.timbovee.com.