On the first Thursday of each month, retailers report year-over-year comps as a measure of the health of the business. We tie in a celebrity blogger and fashion industry expert for some unique channel checks, Real Money Pro and Options Profits for this special feature.
Another issue with and issue that was recently priced is that typically the options are completely overpriced relative to a stock that has been trading for a long time. Because of this we are going to sell a put spread over getting outright long calls in KORS. The May 46/43 put spread collects over $1.00 and has decent odds for success. With the stocks slow trend up and relatively pricey IV, I think we can be out of this trade faster than many realize. Our goal is to buy the spread back for less than $0.50.
Trades: Sell to open KORS May 46 puts at $2.40 and buy to open KORS May 43 puts for $1.30. Net sell the 46/43 put spread at $1.10.