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 - (SPY) - EXPIRATION
EXPIRATION BUY the S&P 500 (SPY) June 2020 $235-$245 in-the-money vertical BULL CALL spread at $10.00
Closing Trade
6-19-2020
expiration date: June 19, 2020
Portfolio weighting: 10%
Number of Contracts = 11 contracts
Assuming the (SPY) does not fall $74.33 by the close today, our position in the S&P 500 (SPY) June 2020 $235-$245 in-the-money vertical BULL CALL spread will expire at its maximum expiration value of $10.00.
This seems like a ridiculously conservative trade today as it is so far in-the-money. When I put it on in early May, it seemed positively suicidal.
My bet that the S&P 500 would not fall to new lows proved correct. By coming out here, you get to earn $1,320 or 13.63% in 26 trading days. Well done and on to the next trade.
This was a bet that the S&P 500 (SPY) would not trade below $245.00 by the June 19 option expiration day in 26 days. That was down a hefty $35 (SPY) points, or $2,900 Dow Average points from there.
Here are the specific trades you need to exit this position:
EXPIRATION of 11 June 2020 (SPY) $235 calls at………….…$74.33
EXPIRATION of short 11 June 2020 (SPY) $245 calls at…….$64.33
Net Proceeds:………………………….………..……….........….….....$10.00
Profit: $10.00 - $8.80 = $1.20
(11 X 100 X $1.20) = $1,320 or 13.63% in 26 trading days.
