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 - Apple Inc. (AAPL) – SELL – TAKE PROFITS
SELL TAKE PROFITS Apple Inc. (AAPL) July 2021 $115-$120 in-the-money vertical BULL call spread at $4.77
Closing Trade
6-14-2021
expiration date: July 16, 2021
Portfolio weighting: 10%
Number of Contracts = 22 contracts
This was a short-term bet that Apple Inc. (AAPL) will stay above $120 by July 16th expiration and I am using this 2% plus pop to take a quick profit on this trade with the intention of reestablishing another Bull position in Apple at a lower price if the stock drops.
Last week, futures and opening reaction to the inflation numbers meant that the economy most likely will be able to stomach the higher costs and pass it on successfully to the consumer.
The market isn’t freaking out at a possible taper tantrum which is most likely the biggest risk to the Nasdaq now when we are talking about short-term trading.
I thought Apple was most likely on the verge of breaking and that’s exactly what we got with a short-term surge in AAPL shares.
I would add with every pullback and will gladly reinitiate another Bull Call Spread in APPL.
I have recently taken profits on a series of Bull Call Spreads, and we are receiving positive signals that tech will be a recipient of a rotational windfall.
Just look at today when the S&P and Dow are down, yet the Nasdaq is up.
It’s time to revert to high quality in a tech sector that is not cheap.
This company has proven to be the quintessential buy the dip tech company.
Traders still in this can wait out until expiration or take profits now and re-invest them back into AAPL at the next entry point.
Aggressive traders can always roll up strike prices to reach for higher percentage gains.
If you don’t do options, hold the stock long term because the stock should hit $170 by end of this year.
Here are the specific trades you need to exit this position:
Sell to Close 22 July 20201 (AAPL) $115 calls at………...….………$15.80
Buy to Close 22 July 2021 (AAPL) $120 calls at…….............…….$11.03
Net Proceeds:…………………........................…..…….………..…….....$4.77
Profit: $4.77 - $4.50 = $.27
(22 X 100 X $.27) = $594 or 6.0%
If you are uncertain on 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.