Housekeeping: RIMM

On Feb 26, we bought June 75/85 call spread for $2.70.  After earnings release, we bought back June $85 calls and sold front month April $75 for net debit of $0.15.  This increased the cost to $2.85 and converted the trade to June/April $75 call calendar.    

Then, when April calls expired, we sold May $75 calls for $1.32 credit, thus converting to June/May $75 call calendar for adjusted price of $1.53.  


Goldman still has "Sell" rating and this morning Pacific Crest is making a big call to sell RIMM ahead of analyst day as they believe RIMM will not be able to get a revenue sharing agreement with China Unicom and there will be continuous market share loss at high-end mobile sets.  


It is time to do something about this trade and given the analyst commentary, I am now decisively going bearish with following adjustment.  


- Buy to close May $75 calls
- Sell to open May $70 calls


I just filled the order for $1.75 net credit.  So, now I have a diagonal bear call spread (long June $75 calls and short May $70 calls).  With this net credit, the adjusted cost of this bear call spread is $0.22 debit.  Meaning, I have cashed out the principal plus some, and now I expect the stock to settle below $70 by May expiration so that May $70 calls expire worthless.  


First, I was bearish, then I was neutral, now I am bearish.  Just trading along as circumstances change about the fundamentals of the company.  


Good luck!