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.
Trade Alert - (CRM) - TAKE PROFITS
SELL the Salesforce (CRM) July 2018 $115-$120 in-the-money vertical BULL CALL spread at $4.90 or best
Closing Trade
6-27-2018
expiration date: July 20, 2018
Portfolio weighting: 10%
Number of Contracts = 22 contracts
I'll use the dovish trade war comments this morning to take profits. Perhaps someone told them that by attacking the US auto industry they would be demolishing about one quarter of the US economy, either directly or indirectly. If you don't sell the rips you can't buy the dips.
So, as much as I love (CRM) I am selling the Salesforce (CRM) July 2018 $115-$120 in-the-money vertical BULL CALL spread at $4.90 or best.
By coming out here you are capturing an 8.88% or $888 profit in 20 trading days.
This was a bet that Salesforce shares wouldn't trade below $120 by the July 20 expiration date.
If you own the stock keep it. Salesforce is going much higher.
For more detail about the long term business prospects for Salesforce, please read "Salesforce Powers On" by clicking here at http://www.madhedgefundtrader.com/salesforce-powers-on/
Here are the specific trades you need to execute this position:
Sell 22 July 2018 (CRM) $115 calls at................$21.40
Buy to cover short 22 July 2018 (CRM) $120 calls at..........$16.50
Net Proceeds:................................................$4.90
Profit: $4.90 - $4.50 = $0.40
(22 X 100 X $0.40) = $880 or 8.88% in 20 trading days.
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To see how to enter this trade in your online platform, please look at the order ticket above, which I pulled off of Interactive Brokers.
If you are uncertain on how to execute an options spread, please watch my training video on How to Execute Vertical Call and Put Debit Spreads by clicking here.
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Please keep in mind that these are ballpark prices only. There is no telling how much the market can move by the time you get this.
Be sure you've signed up for our FREE text alert service. When seconds count, this feature offers a trading advantage. In today's market, investors need every advantage they can get.
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 close to expiration.
If you don't get done, don't worry. There are another 250 Trade Alerts coming at you over the coming 12 months.