🎯 $Gilead Sciences, Inc.(GILD) Options Strategy: Bull Put Spread (Short Put Vertical)
- Underlying: GILD
- View: Cautiously optimistic for a technical bounce from oversold conditions (RSI 17.83). Expecting the stock to hold above the $130 pivot and potentially consolidate towards $135.
- Strategy Type: Credit Spread / Defined Risk
- Option Contract Portfolio:
- Sell 1 GILD May 15, 2026 $130 Put @ $2.05 (Mid)
- Buy 1 GILD May 15, 2026 $125 Put @ $0.53 (Mid)
- Max Gain & Loss: Max Gain: $152 Credit, Max Loss: $348 (per spread)
- Initial Cost/Credit: Initial Net Credit: ~$1.52 per share ($152 per spread)
- Greek Exposure (Simulated):
- Delta: ~+0.24 (Positive, bullish)
- Theta: ~+0.12 (Positive, benefits from time decay)
- Vega: ~-0.04 (Negative, hurts if IV rises, benefits if IV falls)
- Gamma: ~-0.03 (Low, limited sensitivity to large moves)
- Rho: Negligible for short-term
- Rationale: This strategy capitalizes on the oversold bounce thesis and the current high IV (37.08%, 80th percentile). Selling the $130 put collects premium (high Theta) due to elevated IV. Buying the $125 put defines and limits risk below the key $125 support level. The positive Delta aligns with the bullish bias, while the negative Vega is acceptable as a bounce could calm volatility. The net credit provides a buffer, and the maximum profit is achieved if GILD closes above $130 at expiration.
- Time Frame: Short-Term (18 days to expiration)
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