Power Plays Options
New Idea: BABA Call Spread
March 13, 2025
By Scott Redler
I want more long exposure to Alibaba (BABA) so I'm adding this position to Power Plays Options:
- Long BABA April 11 $145 X $155 Call Spread
(long the April 11 $145 calls, and short an equal number of April 11 $155 calls)
This call spread looks good in the $2.5o to $3.00 range, or lower.
Should BABA stock be at $155 or higher at expiration on April 11, the spread will be worth $10.
I am using a spread to offset the impact of time decay. BABA could rally out of nowhere -- maybe tomorrow, maybe 2 weeks from now. So the spread mitigates that cost a bit.
At the same time, the spread has strong reward potential should BABA rally the way I expect.
-Scott
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