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Options Action: Apple

How should you trade Apple ahead of their mystery event on September 1st. Mike Khouw suggests using options.

Specifically, Khouw suggests fading the move and collecting some elevated options premium by selling a call spread.

Specifically, he's a seller of the Oct 250 call @ $9.25 and a buyer of the Oct 270 call @ $3.25

***How Mike’s Trade Makes Money***
Stock At $244|
Profits Up To $256 - Called Away At $256
Protected Down To $238
Losses Below $238

*Learn more about this trade. Watch the video now!


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Trader disclosure: On Aug 30, 2010, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Terranova Owns (AXP), (GS), (IBM), (QCOM), (AAPL), (GOOG), (BRCM), (TER), (MSFT), (C), (MRVL), (BMO), (V), (POT), (OXY), (GLD), (SU), (FCX), (APA), (XBI); Adami owns (AGU), (BTU), (NUE), (C), (GS), (INTC), (MSFT); Adami’s wife works at Merck; Pete Najarian owns (SCCO); Pete Najarian owns (TCK); Pete Najarian owns (PFE); Pete Najarian owns (CELG); Pete Najarian owns (CNI)

For Joe Terranova
Terranova is chief market strategist of Virtus Investment Partners, LTD.
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For Mike Khouw
Cantor Fitzgerald makes a market in (AAPL)

For Michael Block
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