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Starbucks (SBUX) Trading Near $58.85 Support Level

Dec 07, 2017 ( via COMTEX) --

The patented option-trade picking algorithms that power's Artificial Intelligence Center Aare highlighting two trades on Starbucks (<a href="">SBUX</a>) today after it closed at $59.27 on Dec 6, 2017. For more conservative investors, look at a covered call using the Feb 16, 2018 $57.50 call for a net debit of about $56.17. This trade will return 2.34% (12.07% annualized, for comparison purposes only) as long as the stock closes above $57.50 at expiration. Starbucks can fall 5.22% before causing a problem. For investors with a higher appetite for risk, consider a diagonal spread with a Jan 18, 2019 $40 call taking the place of the long stock position and the same short position in the Feb 16, 2018 $57.50 call. This trade only costs about $16.94 to get into and the rate of return increases to 3.24% (12.07% annualized, for comparison purposes only) but the downside protection falls to 3.93%.

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