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 - Airbnb, Inc. (ABNB) – BUY
BUY the Airbnb, Inc. (ABNB) November 2022 $95-$100 in-the-money vertical BULL CALL spread at $3.40
Opening Trade
10-13-2022
expiration date: November 18, 2022
Portfolio weighting: 10%
Number of Contracts = 29 contracts
This is a bullish trade in accommodation-sharing platform Airbnb, Inc. (ABNB) with a 36-day time horizon.
There is now a 100% probability of a .75% Fed Funds rate hike at the next Fed meeting on November 2nd.
That means the expected rate rise is fully priced into tech shares.
I’m going back in on one of my favorite tech plays in the short term for a vertical bull call spread.
ABNB has ironclad technical support at $100 and chalks the juicy potential profit numbers up to the elevated volatility this morning.
The tech index NASDAQ is falling apart while the Mad Hedge Tech Alert service is going from strength to strength. We will take a victory lap at the end of the year.
Here are the specific trades you need to execute this position:
Buy to Open 29 November 2022 (ABNB) $95 calls at………….………$18.60
Sell to Open 29 November 2022 (ABNB) $100 calls at……......….….$15.20
Net Cost:…………………....................................…..…….………..…….....$3.40
Potential Profit: $5.00 - $3.40 = $1.60
(29 X 100 X $1.60) = $4,640 or 47.10%
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.
