Crypto Alert - (BLOK) October 15, 2021 - EXPIRATION AT MAX PROFIT
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 - (BLOK) – EXPIRATION AT MAX PROFIT
EXPIRATION AT MAX PROFIT the Amplify Transformational Data Sharing ETF (BLOK) $41-$46 in-the-money vertical Bull Call spread at $5
Closing Trade
10-15-2021
expiration date: October 15, 2021
Number of Contracts = 23 contract
This was a trade on crypto ETF Amplify Transformational Data Sharing ETF (BLOK) $41-$46 in-the-money vertical Bull Call spread at $4.30.
This was a bet that BLOK would stay above $46 by the October 15th expiration.
This means we are collecting maximum profits unless the ETF drops more than 10% by today’s closing which it won’t.
Just to refresh readers, this trade was executed when Bitcoin was down 9-11% on that day (when the coin was trading at $42,000!) which turned out to be a beautiful buy the dip opportunity in crypto-assets and a short term bottom.
I couldn’t have done it any better and it was a great way to introduce readers to the Mad Hedge Crypto Service.
Crypto assets have done nothing except explode to the upside with the bellwether Bitcoin exceeding $60,000 per 1 unit today. This paves the way for BTC to make new all-time highs by year-end.
Well done and on to the next trade!
You don’t have to do anything with this expiration.
Your broker will automatically use your long position to cover your short position, canceling out the total holdings.
The entire profit will be credited to your account on Monday morning, October 18 and the margin freed up.
Some firms charge you a modest $10 or $15 fee for performing this service.My favorite crypto ETF is Amplify
Transformational Data Sharing ETF (BLOK) which has morphed into one of the best crypto ETFs on the market since its inception.
(BLOK) is an actively managed ETF that seeks to provide total return by investing at least 80% of its net assets in equity securities of companies actively involved in the development and utilization of blockchain technologies. It trades right at net asset value, meaning you don’t have to pay any premium whatsoever.
(BLOK)’s biggest two positions are Bitcoin proxy MicroStrategy (MSTR) and a Canadian crypto mining company called Hut 8 Mining Corp (HUT), which has already tripled since June.
I have already shot out a MicroStrategy (MSTR) trade alert to new readers and are incredibly bullish on the company.
However, this ETF encompasses more than (MSTR) offering broader exposure to firms related to Bitcoin, crypto miners, and software companies that are heavily into crypto.
Hut 8 engages in industrial-scale bitcoin mining operations. It also owns and operates 38 BlockBoxes in Drumheller, Alberta and 56 BlockBoxes in Medicine Hat, Alberta.
BlockBoxes are one of the most powerful and cost-effective bitcoin mining units available on the market.
(BLOK) doesn’t track bitcoin 1:1, but it does mimic the price action relatively closely albeit with less extreme swings.
Controlling excess volatility is something you should be happy about.
(BLOK) also has an expense ratio of only 0.71%, which isn’t too expensive for those who want to buy and hold the ETF and not trade the derivative.
Buying (BLOK) is most likely the best way to ensure safe trading under the framework of the SEC, but I understand others have a higher risk profile which is also welcome.
To understand more about the ETF (BLOK), click here.
Here are the specific trades you need to execute this position:
Expiration of 23 October 2021 (BLOK) $41 calls at………….………$10.00
Expiration of October 2021 (BLOK) $46 calls at……..............…....$5.00
Net Proceeds:……………………..…….………..…................……….….....$5.00
Profit: $5 - $4.3 = $.70
(23 X 100 X $.70) = $1,610 or 16.28% in 38 days
If you are uncertain on 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.
