As a potentially profitable opportunity presents itself, John will send you an alert with specific trade information as to what should be bought, when to buy it, and at what price.
Trade Alert – (SPY)- TAKE PROFITS
SELL the S&P 500 SPDR?s (SPY) January, 2016 $182-$187 in-the-money vertical bull call spread at $4.90 or best
expiration date: January 15, 2016
Portfolio weighting: 10%
Number of Contracts = 22 contracts
At this morning?s opening market we have captured 74% of the potential profit in this position. So I am going to take profits here on the S&P 500 SPDR?s (SPY) January, 2016 $182-$187 in-the-money vertical bull call spread.
In this environment, making a 6.2% profit in only three trading days is good enough for me. Don?t be greedy. Take the money and run!
If you want to go for the extra ten cents and avoid paying a commission, run this position into the expiration in 3 trading days. I?m almost sure you?ll get it.
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 on how to execute an options spread, please watch my training video on ?How to Execute a Bull Call Spread? by clicking here at https://www.madhedgefundtrader.com/ltt-executetradealerts/. You must me logged into your account to view the video.
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.
Here are the specific trades you need to execute this position:
Sell 22 January, 2016 (SPY) $182 calls at????.?.??$12.35
Buy to cover short 22 January, 2016 (SPY) $187 calls at.?..$7.45
Profit: $4.90 – $4.61 = $0.29
(22 X 100 X $0.29) = $638 or 0.64% profit for the notional $100,000 portfolio