What is this trade?

James.DeGori said:
A friend of mine (online) often shares trades he makes. Here is an example:

ROKU 1 OCT-16-20 155/Oct-16-20 160/Sep-18-20 Custom spread. 19.7 limit. This a call debit spread +1-1+1.

What is he looking at in order to set this type of trade up, and why would you want to do it?
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Net long. Bullish bet but didn't believe RUKU would go beyond $160 at expiration, so shorted $160 to reduce his cost base.
 
ironchef said:
Net long. Bullish bet but didn't believe RUKU would go beyond $160 at expiration, so shorted $160 to reduce his cost base.
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OMFG can you be more wrong? (Don’t answer that).

The dude is long the Oct 55/60 call spread AND long an additional Sep 55C. He wants the stock at inf.
 
destriero said:
OMFG can you be more wrong? (Don’t answer that).

The dude is long the Oct 55/60 call spread AND long an additional Sep 55C.
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We are amateur retails. Simple minded and dumb.

Tell me what is wrong with the logic? Isn't he net bullish? o_O
 
ironchef said:
We are amateur retails. Simple minded and dumb.

Tell me what is wrong with the logic?o_O
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You got the structure wrong by stating that he wants the shares to 160. He is long a single call and a bull vertical. He wants it to rally, period. The position never flips modality. He is always long with this position.
 
destriero said:
You got the structure wrong by stating that he wants the shares to 160. He is long a single call and a bull vertical. He wants it to rally, period. The position never flips modality. He is always long with this position.
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True. I can't argue with that.
 
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