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 - (TSLA) - STOP LOSS
SELL the Tesla (TSLA) March 2025 $210-$220 in-the-money vertical bull call debit spread at $6.90 or best
Closing Trade
3-10-2025
expiration date: March 21, 2025
Portfolio weighting: 10% weighting
Number of Contracts = 12 contracts
The president really set the cat among the positions by admitting that his new economic policies may cause a recession. Sounds like he was reading Mad Hedge Fund Trader!
You normally don’t expect implied volatility to go up when you put on a trade at 63%. But that is exactly what has happened, with Tesla implieds now at 79%. (TSLA) has been dropping 10% a day and is now only one 10% move away from our nearest strike price. Tesla has dropped an incredible 54% in less than three months. When a CEO doesn’t care about his share price, it can drop a lot.
Therefore, I am selling the Tesla (TSLA) March 2025 $210-$220 in-the-money vertical bull call debit spread at $6.90 or best.
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 10 cents with a second order.
If you live in a foreign time zone when the US stock market is closed, such as Australia, or don’t want to sit in front of a screen all day, simply enter a spread of Good-Until-Cancelled orders overnight, like $6.90, $6.80, $6.70, $6.60, and $6.50. You should get done on some or all of these.
With this trade, I was willing to bet that Tesla shares would not fall below $220 by the March 21 option expiration in 15 trading days.
Here are the specific trades you need to close out this position:
Sell 12 March 2025 (TSLA) $210 calls at……….…................$24.00
Buy to cover short 12 March 2025 (TSLA) $220 calls at…….$17.10
Net Proceeds:………………………….……….………................……$6.90
Loss: $8.80 - $6.90 = $1.90
(12 X 100 X $1.90) = $2,280
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.
