This Clean Energy Trade Could Give A Max Gain Of 1,686% By Summer

Back to the trade, 10,000 30-35 call spreads traded in ICLN July calls. The 30 calls were purchased, while the 35 calls were sold simultaneously. This trade occurred with the stock at $21.59, and it cost about $0.28 per spread. That means the capital outlay on the trade is roughly $280,000 for 10,000 spreads, which is also the max loss potential on the trade if ICLN doesn’t climb above $30 by July expiration.

Max gain on the trade is $4.72 (the width of the spread of 5 minus the cost of the trade of $0.28) and occurs if ICLN is above $35 at expiration. If max gains occur, profits will be a lofty 1,686% or $4.7 million dollars. Of course, this isn’t a likely scenario as ICLN would need to climb 62% higher by July.

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