When John identifies a strategic exit point, he will send you an alert with specific trade information as to what security to sell, when to sell it, and at what price. Most often, it will be to TAKE PROFITS, but, on rare occasions, it will be to exercise a STOP LOSS at a predetermined price to adhere to strict risk management discipline.
Tech Alert - NVIDIA Corporation (NVDA) – BUY
Buy NVIDIA Corporation (NVDA) February 2025 $99-$104 in-the-money vertical BULL CALL spread at $4.20
Opening Trade
1-27-2025
expiration date: February 21, 2025
Portfolio weighting: 10%
Number of Contracts = 24 contracts
Buying Nvidia on the dip after shares pulled back by 15% this morning. We have 25 days until expiration.
Tech news is out that China has come out with a cheaper AI replacement which means AI stocks don’t need all those fancy Nvidia chips.
Even if it is true, I don’t believe the full story will be priced in before the February expiration.
Don’t pay more than $4.30 – prices are highly volatile in this name this morning for good reason.
Here are the specific trades you need to execute this position:
Buy to Open 24 February 2025 (NVDA) $99 calls at…………..$23.80
Sell to short 24 February 2025 (NVDA) $104 calls at………….$19.60
Net Cost:……………………..…….………..…….................................$4.20
Potential Profit: $5 - $4.20 = $.80
(24 X 100 X $.80) = $1,920 or 19.05% in 25 days
To see how to enter this trade in your online platform, please look at the order ticket below, which I pulled off of Interactive Brokers.
If you are uncertain about how to execute an options spread, please watch my training video by clicking here.
The best execution can be had by placing your bid for the entire spread in the middle market and waiting for the market to come to you. The difference between the bid and the offer on these deep-in-the-money spread trades can be enormous.
Don’t execute the legs individually, or you will end up losing much of your profit. Spread pricing can be very volatile on expiration months farther out.
Keep in mind that these are ballpark prices at best. After the alerts go out, prices can be all over the map.