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 – (MSTR) – TAKE PROFITS
Sell the MicroStrategy (MSTR) May 2025 $200-$210 in-the-money vertical bull call debit spread at $9.95 or best
Closing Trade
4-24-2025
expiration date: May 16, 2025
Portfolio weighting: 10% weighting
Number of Contracts = 13 contracts
Since I added this position a week ago, (MSTR) has risen by an incredible $50, or 21.4%. We also caught a massive decline in option implied volatilities from 99% to 71%.
With 96.7% of the maximum potential profit in hand, the risk/reward of continuing for 16 more trading days is no longer favorable. Better to raise some dry powder here to save for the next trade, of which there will be many.
MicroStrategy is a highly leveraged long play on Bitcoin and at 97% implied volatility for its options.
Therefore, I am selling the MicroStrategy (MSTR) May 2025 $200-$210 in-the-money vertical bull call debit spread at $9.95 or best
DO NOT USE MARKET ORDERS UNDER ANY CIRCUMSTANCES.
This was a bet that MicroStrategy would not fall below $210 by the May 16 option expiration in 5 trading days.
Here are the specific trades you need to exit this position:
Sell 13 May 2025 (MSTR) $200 calls at……………………………………$148.00
Buy to cover short 13 May 2025 (MSTR) $210 calls at……………….$138.05
Net Proceeds:………………………….………………………………………………$9.95
Profit: $9.95 – $8.50 = $1.45
(13 X 100 X $1.45) = $1,885 or 17.06% in 5 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.
