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Juno Therapeutics Inc (NASDAQ:JUNO) has had a few negatives, but the technology is good, and I think eventually it will go higher.

While JUNO is currently at $44, it’s very possible for it to go to $60, as it really did sell off a long way; it was at $62 as recently as late November. So, let’s make a bullish play for that outcome, using a position with a very low entry price:

Using a spread order, buy to open 1 JUNO Jan. 19th $52.50 call and sell to open 2 JUNO Jan. 19th $60 calls for a net debit of about $0.25.

Note: There are several January expirations available for JUNO options. Be sure you are opening the monthly options that expire on Friday, Jan. 19, 2018.

A ratio debit spread is simply a way to lower the cost of buying options, as the two options that you sell to open (short) help offset the cost of the option that you buy to open. Therefore, this ratio call debit spread is a way to lower the cost of establishing a bullish call option trade. Many brokers will require the use of margin and/or a set amount of reserved capital to execute a ratio debit spread; contact your broker directly for specific requirements.

Because you are short a naked call in this ratio call debit spread, one risk is that the underlying stock could unexpectedly move up sharply. If that happens, we would need to buy back to cover and close the naked call option for a loss.

The other risk due to the naked call is if the stock moves up sharply the call could be assigned. This means that for every 1 call option we sold to open (shorted), we would need to buy 100 JUNO shares on the open market at an unknown higher price and then sell the shares at the $60 strike price for a loss. So, you’ll want to exit if JUNO gets up to $60.

Ken Trester is editor of the popular Maximum Options trading advisory. If you act now, you can take advantage of our limited-time $29 for 2 months Holiday Savings Special. Trester has been trading options since the first exchanges opened in 1973 with a winning streak that goes back to 1984 with money-doubling average annual profits since 1990.