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 - (MSFT) – TAKE PROFITS
SELL the Microsoft (MSFT) August 2024 $440-$450 in-the-money vertical Bear Put debit spread at $9.95 or best
Closing Trade
8-9-2024
expiration date: August 16, 2024
Number of Contracts = 12 contracts
My bet that Microsoft would fail to bounce appreciably from the Monday morning low proved prescient. The stock has barely moved, beckoning lower lows. As a result, we now have 96.15% of the maximum potential profit in hand.
The risk/reward of continuing is no longer favorable. In this market, you don’t let profitable positions grow hair on them.
I am therefore selling the Microsoft (MSFT) August 2024 $440-$450 in-the-money vertical Bear Put debit spread at $9.95 or best.
As a result, you get to take home (12 X 100 X $1.25) = $1,500 or 14.37% in 3 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.
To learn more about the company, please visit their website at www.microsoft.com
This is a bet that Microsoft will not rise above $440 by the August 16 option expiration in 6 trading days.
Microsoft Corporation is a Megacap American multinational corporation and headquartered in Redmond, Washington.[2] Microsoft's best-known products are the Windows line of operating systems, the Microsoft suite of productivity applications that include Word, Excel, and PowerPoint, and the Edge web browser. Its flagship hardware products are the Xbox video game consoles and the Microsoft lineup of touchscreen personal computers. Microsoft ranked No. 14 in the 2022 Fortune 500 rankings of the largest United States corporations by total revenue and it was the world's largest software by revenue in 2023.
Here are the specific trades you need to execute this position:
Sell 12 August 2024 (MSFT) $450 puts at…………..…......……$48.00
Buy to cover short 12 August 2024 (MSFT) $450 puts at……$38.05
Net Proceeds:…………………...………….…..................................$9.95
Profit: $9.95 - $8.70 = $1.25
(12 X 100 X $1.25) = $1,500 or 14.37% in 3 days.
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.
