As a potentially profitable opportunity presents itself, John will send you an alert with specific trade information as to what you should buy, when to buy it, and at what price.
Trade Alert - (SPY)- TAKE PROFITS
SELL the S&P 500 SPDR (SPY) November, 2016 $220-$223 in-the-money vertical bear put spread at $2.88 or best
Closing Trade
11-1-2016
Expiration Date: November 18, 2016
Portfolio Weighting: 10%
Number of Contracts = 38 contracts
We are having a monster day in the market today, with our short positions kicking in big time.
So, I am going to use the selloff today, inspired by a modest improvement in the polls for Donald Trump, to reduce my positions.
If you bought the ETF outright, hold for the long term.
My goal is to be 100% in cash on election day so I can have plenty of dry powder with which to take advantage of any extreme moves post election.
With this Trade Alert, I will be moving from an 80% invested position a week ago to only 10% today.
The market doesn?t ask you twice to take a profit, so I am selling my S&P 500 SPDR (SPY) November, 2016 $220-$223 in-the-money vertical bear put spread.
At this price we are reeling in a very generous 14.28% profit in a mere 9 trading days.
By taking profits here, we are capturing 75.00% of the maximum potential profit with 13 trading days left until the November 18th expiration.
We also get to duck the risk of holding the position through the election.
I have no doubt that Hillary Clinton will have the Electoral College locked up on November 8th.
What is unknown is the number of market-gyrating bombshells headed our way in the next six trading days. With the FBI now involved in election proceedings, anything can happen.
Suddenly, cash looks very attractive.
This was a bet that the S&P 500 (SPY) wouldn?t trade above $220 at the November options expiration in 22 trading days. That would be a new all time high.
From the perspective of the $211 handle today, that looks like a stroke of genius.
I believe we are going to new highs, but just not quite yet.
To see how to enter this trade in your online platform, please look at the order ticket below, which I pulled off of optionshouse.
If you are uncertain about how to execute this options spread, please watch my training video How to Execute a Vertical Bear Put Debit Spread
Please keep in mind these are ballpark prices at best. After the text alerts go out, prices can be all over the map. There is no telling how much the market will have moved by the time you get this email.
Paid subscribers, be sure you've signed up for our FREE text alert service. When seconds count, this feature offers a trading advantage.? In today's volatile markets, individual investors need every advantage they can get.
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 with only 13 days to expiration.
Here Are the Specific Trades You Need to Execute This Position:
SELL 38 November, 2016 (SPY) $223 puts at??.?.??$12.20
BUY to cover short 38 November, 2016 (SPY) $220 puts at..$9.32
Net Cost:????????????????????......$2.88
Profit: $2.88 - $2.52 = $0.36
(38 X 100 X $0.36) = $1,368 or 14.28% profit in 9 trading days.
