In last week’s re-cap we briefly mentioned the 1*NKE (Nike)-2*GCO (Genesco) spread which we bought on Friday morning for about $0.85. NKE had gapped down after releasing earnings and GCO was slow to follow. Eventually GCO traded lower also and we were able to close out the position by the end of the day for an over $3 gain per spread.

This week we got an opportunity to buy the spread again on March 22nd shortly after the open for about $0.60, with NKE down 2% from Friday’s close and GCO trading 2% higher than Friday’s close. Once again GCO followed NKE lower, and we unwound the spread on the morning of March 23rd for an approximate $3.25 gain per spread.

We didn’t think we’d get another chance to buy this one again so soon, but yesterday afternoon we bought the spread again at about $0.60. As of this writing, GCO is up over 3% and the spread is trading at -$1.60. This one, however, has been quick to come back inline.

Written by Norm Winer. Follow me on Twitter and StockTwits