Buy Alert: January 30, 2015
Buy Alert: January 30, 2015
Trade Details
Buy King Digital Entertainment (KING) February 21st 13.54 Calls for $1.15 or better (lower)
Why?
KING is a maker of popular mobile video games, such as Candy Crush Saga. Mobile gaming is gaining massive popularity, yet KING is trading at an extremely favorable valuation. It seems the market doesn’t yet have faith in the stock. However, options traders are heavily bullish and have been buying upside calls ahead of this month’s earnings report.
We’re going to do the same – buy February calls. Just ignore the weird strike – assume the 13.54 strike is basically the same as the 13.50 strike. Conservative investors can take profits at $15. Aggressive investors can hold up to $18. For risk control, conservative traders should exit at $12, while more aggressive traders can hold down to $10.50.
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Category: OTW Buy Alerts
