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 - (AAPL) – TAKE PROFITS
SELL the Apple (AAPL) June 2022 $155-$165 in-the-money vertical Bear Put at $9.65 or best
Closing Trade
5-20-2022
expiration date: June 17, 2022
Portfolio weighting: 10%
Number of Contracts = 12 contracts
I think we are currently seeing a capitulation selloff not just for Apple, but for the market as a whole. It is therefore prudent to start reeling in my short positions.
With the Volatility Index (VIX) at $30, it is better to free up the cash and pile it into new positions.
I am therefore selling the Apple (AAPL) June 2022 $155-$165 in-the-money vertical Bear Put at $9.65 or best.
As a result, you get to take home $1,740, or 17.68% in 6 trading days. Well done and on to the next trade.
DO NOT USE MARKET ORDERS UNDER ANY CIRCUMSTANCES.
Simply enter your limit order, wait five minutes, and if you don’t get done, cancel your order and lower your offer by 5 cents with a second order.
This was a bet that Apple (AAPL) would not rise above $155 by the June 17 options expiration day in 25 trading days.
For more about (AAPL), please click here for their website.
Here are the specific trades you need to exit this position:
Sell 12 June 2022 (AAPL) $165 puts at…………........………$28.00
Buy to cover short 12 June 2022 (AAPL) $155 puts at…....$18.35
Net Proceeds:……………………..…......….………..………….….....$9.65
Profit: $9.65 - $8.20 = $1.45
(12 X 100 X $1.45) = $1,740 or 17.68% in 6 trading days.
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.
