Put Options on FB on 11/23/2012

Facebook (FB) operates as a social networking company worldwide. The company builds tools that enable users to connect, share, discover, and communicate with each other; enables developers to build social applications on Facebook or to integrate their Websites with Facebook; and offers products that enable advertisers and marketers to engage with its users.

Stockwinners us bearish on this name for the following reason : 

1. The stock has had a great run from its Nov lock-up period and it is a little bit over streched. we believe that there is going to be a moderate correction before FB goes higher . 

TRADE: Buy 1 DEC 23 put for less than .70

Breakeven & Profit/Loss Analysis:

• Breakeven at $22.30 on Dec expiration
• Profit below $22.30 , Max gain is 22.30 if the stock goes to zero. 
• Losses btwn$23 to $22.30 up to $.70 , max loss of $.70 above $23

The pay off table is presented below:

Trade Buy 1 December $23.00 Put at $0.70 For a net debit of $0.70 Profit/Loss Analysis Breakeven at $22.30 Maximum profit is unbounded Maximum loss is ($70.00) at strike of $23.00 Closing Summary Sold 1 December $23.00 Put at $0.00

Position closed on 1/2/2013 at price of $0.00 with a -100.00% loss in 40 days.

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