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 - Amazon.com, Inc. (AMZN) – STOP LOSS
SELL the Amazon.com, Inc. (AMZN) November 2022 $87-$92 in-the-money vertical BULL CALL spread at $3.40
Closing Trade
11-3-2022
expiration date: November 18, 2022
Portfolio weighting: 10%
Number of Contracts = 24 contracts
I’m using this morning bump to exit my bull call spread in AMZN.
Hard to believe that the ecommerce company is down 25% in the past few weeks but that is where we stand as poor earnings report was followed by a hawkish Fed that has completely crushed tech stocks.
We are now in a risk-off environment and taking a loss on this position as we exit.
Here are the specific trades you need to exit this position:
Sell to Close 24 November 2022 (AMZN) $87 calls at………….………$7.70
Buy to Close 24 November 2022 (AMZN) $92 calls at……........…….$4.30
Net Proceeds:……………………..…...........................….………..…….....$3.40
Loss: $4.20 - $3.40 = $.80
(24 X 100 X $.80) = $1,920 or 17.80%
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.
