V – Visa, Inc. – A diminutive bullish call butterfly spread on the global payments technology firm indicates one options strategist expects Visa’s shares to rally significantly by December expiration. Shares of the credit card issuer increased 1.00% by 12:55 pm ET to trade at $74.00. The bullish individual purchased 1,000 calls at the December $80 strike at an average premium of $1.41 each, sold 2,000 calls at the December $85 strike for an average premium of $0.56 apiece, and picked up 1,000 calls at the higher December $90 strike at an average premium of $0.26 a-pop. Net premium paid to purchase the call ‘fly amounts to $0.55 per contract. The investor responsible for the transaction is positioned to profit should Visa’s shares surge 8.85% to exceed the effective breakeven price of $80.55 by expiration day in December. Maximum potential profits of $4.45 per contract pad the investor’s wallet if the price of the underlying shares increases 14.865% to settle at $85.00 at expiration. The butterfly spread strategy is a very efficient way to take a bullish stance on Visa, Inc. because potential losses are capped at $0.55 per contract, but potential rewards of $4.45 apiece are more than 8-times greater.
