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Call Spread on CREE on 6/17/2013

Upward TrendlineCree, Inc. (CREE) develops and manufactures lighting-class light emitting diode (LED) products, lighting products, and semiconductor products for power and radio-frequency (RF) applications.

Its LED products include blue and green LED chips that are used in various applications, including video screens, gaming displays, function indicator lights, and automotive backlighting; LED components comprising lighting class packaged LED products for lighting applications, and surface mount and through-hole packaged LED products for video, signage, general illumination, transportation, gaming, and specialty lighting applications; and silicon carbide (SiC) wafers, which are used in the manufacture of optoelectronics, RF, and power switching applications.

The company also offers LED and traditional lighting systems for indoor and outdoor applications. The company also provides semiconductor materials and devices primarily based on silicon carbide (SiC), gallium nitride (GaN), and related compounds; and foundry services for wide bandgap MMICs that allow customers to design their own custom RF circuits.

Shares are heading higher in an upward trading line. The company started a marketing campaign with Home Depot whereby Cree will sell its products at HD and the reatialer will actively promotes the company's LED lights.

52-Week Trading Range:  $22.25 - $64.32

Last Trade: $62.80

Here is the trade:

Buy One July $62.5 contract for $3.40

Sell One July $67.5 contract for $1.59

Net Investment: $1.81

Pay off table is shown. 

Lose $1.81 if stock closes below $62.50 by July expiration,

Investment will worth $3.25 if CREE closed at $67.50 by July Expiration

Trade

  • Buy 1 July $62.50 Call at $3.40
  • Sell 1 July $67.50 Call at $1.59
  • For a net debit of $1.81

Profit/Loss Analysis

  • Breakeven at $64.31
  • Maximum profit is $319.00 at strike of $68.00
  • Maximum loss is ($181.00) at strike of $62.00

Closing Summary

  • Sold 1 July $62.50 Call at $4.00
  • Bought 1 July $67.50 Call at $1.40

Position closed on 7/2/2013 at price of $2.60 with a 43.65% gain in 15 days.

Updates

7/2/2013 9:48:43 AM

We are closing the CREE position.

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