3 Option Trade Ideas In Blackstone

Blackstone has rallied 41.1% since the March 23rd bottom compared to the S&P 500’s rally of 13.5%

The stock is showing significant accumulation

Three bullish options plays give different ways to play the stock depending on an investors risk/reward preferences.

Blackstone’s stock was hit hard in the recent Covid-19 led selloff falling 49.2% compared to the S&P 500’s drop of only 35.4%. I say only because that’s still a decent decline and one of the worst on record for the major market index.

However, since the market found an intermediate-term bottom on March 23rd, Blackstone has rallied 41.1% compared with the S&P 500’s rally of 13.5%.

Stocks showing relative strength are great candidates for bullish option trades and Blackstone may present some interesting opportunities over the coming weeks and months.

A bullish position in Blackstone gives investors exposure to one of the largest, most respected and successful investment managers in the world. The stock is still 28.3% below its recent high so the upside potential is there is stocks can maintain their recent bullish run.

Looking at the chart, there has been significant accumulation in the stock since mid-March indicating that large trader might be building a position.

Rather than just going long, investors can use the options market to find smart ways to trade Blackstone stock with an attractive risk to reward ratio.

Implied volatility is also high at around 70%. Not quite as high as it was a few weeks ago, but still a lot higher than the 20-30% at which it typically trades.

That means it’s a great time to be a seller of options on BX. That coupled with the potential bullish action makes it a great candidate for a bull put spread.

Option Trade Idea 1: Sell A Bull Put Spread

A bull put spread is a defined risk option strategy that profits if the stock closes above the short strike at expiry.

To execute a bull put spread an investor would sell an out-of-the-money put and then but a further out-of-the-money put.

1 2 3
View single page >> |

Disclaimer: The information above is for educational purposes only and should not be treated as investment advice. The strategy presented would not be suitable for investors who are ...

How did you like this article? Let us know so we can better customize your reading experience. Users' ratings are only visible to themselves.


Leave a comment to automatically be entered into our contest to win a free Echo Show.