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 - (WYNN) – STOP LOSS
SELL the Wynn Resorts (WYNN) March 2020 $110-$120 in-the-money vertical BULL CALL spread at $7.20 or best
Closing Trade
2-24-2019
Expiration date: March 20, 2020
Portfolio weighting: 10%
Number of Contracts = 12 contracts
The meltdown is on, so I am raising cash for better buying opportunities down the road.
Therefore, I'm selling the Wynn Resorts (WYNN) March 2020 $110-$120 in-the-money vertical BULL CALL spread at $7.20 or best.
This was a bet that Wynn shares would NOT fall below $120.00 by the March 20 option expiration date in 20 trading days.
This was also a bet that we are not already in a recession, which I believe is still at least 12 months off.
Here are the specific trades you need to exit this position:
Sell 12 March 2020 (WYNN) $110 calls at.............................$15.00
Buy to cover short 12 March 2020 (WYNN) $120 calls at......$7.80
Net Proceeds:.......................................................................$7.20
Loss: $8.60 - $7.20 = -$1.40
(12 X 100 X -$1.40) = $1,680 or 16.27%.
To see how to enter this trade in your online platform, please look at the order ticket above, 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 Vertical Call and Put Debit Spreads by clicking here.
You must be logged into your account to view the video.
Things to Keep in Mind
Remember, these are ballpark prices only. There is no telling how much the market can move by the time you get this.
Be sure you've signed up for our FREE text alert service. When seconds count, this feature offers a trading advantage. In today's market, 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 close to expiration.
If you don't get it done don't worry. There are another 250 Trade Alerts coming at you over the coming 12 months.
