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 Trade Alert - (OKTA) – BUY
BUY the Okta, Inc. (OKTA) September 2019 $105-$110 in-the-money vertical BULL CALL spread at $4.10 to $4.35
Opening Trade
8-29-2019
expiration date: September 20, 2019
Portfolio weighting: 10%
Number of Contracts = 24 contracts
This guidance downgrade was enough to crush the stock in the morning down almost 9%.
This is a great entry point into the stock.
Okta, Inc. provides identity solutions for enterprises, small and medium-sized businesses, universities, non-profits, and government agencies in the United States and internationally.
That means they protect passwords and develop the technology behind it.
Okta earnings and revenue for the second quarter beat estimates, while October quarter bottom-line guidance missed Wall Street targets, the company reported Wednesday. The Okta earnings news sent shares in the cybersecurity firm down in extended trading.
Okta (OKTA) said it lost 5 cents per share, narrowing its loss from a year earlier. Revenue climbed 49% to $140.5 million, handily topping estimates. Analysts expected Okta to report a loss of 11 cents a share on sales of $131.2 million for the period ended July 31.
A year earlier, Okta lost 15 cents a share on sales of $94.6 million.
Okta stock first rose, then fell and was down 3.7% to 128.20 in after-hours trading on the stock market yesterday.
For the current October-ending quarter, Okta forecast a loss of 12 cents to 13 cents on revenue of $143.5 million. Analysts had projected sales of $140.5 million, with a 9-cent loss.
Hackers often target employees or management with administrative access to company computer systems. Okta's software monitors and manages privileged accounts. Companies are focusing more on internal security threats using Zero Trust products from Okta and others.
Here are the specific trades you need to execute this position:
Buy 24 September 2019 (OKTA) $105 calls at………….………$17.80
Sell short 24 September 2019 (OKTA) $110 calls at………….$13.70
Net Cost:……………………..…….………..……..............................$4.10
Potential Profit: $5.00 - $4.10 = $0.90
(24 X 100 X $0.90) = $2,160 or 21.60% in 23 days.
To see how to enter this trade in your online platform, please look at the order ticket below, which I pulled off of Interactive Brokers.
If you are uncertain on how to execute an options spread, please watch my training video on “How to Execute a Vertical Bull Call Spread” 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.