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)- BUY PUTS
Buy the S&P 500 SPDR?s (SPY) February, 2016 $190 Puts outright at $3.88 or best
expiration date: February 19, 2016
Portfolio weighting: 5%
Number of Contracts = 13 contracts
You can pay all the way up to $4.50 for this put option contract and it still makes sense.
I am primarily adding this ?RISK OFF? position to hedge my risk in the ?RISK ON? (SPY) January $185-$190 call spread and the January $182-$187 call spread, which both expire in 5 trading days on January 15.
The failure of the market to rally in the face of today?s good news on the December nonfarm payroll and the China rally, means that the current rough patch may continue into next week.
If you can?t trade the options, stand aside. This is not a great place to initiate a new naked short.
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 trade, 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:
Buy 13 February, 2016 (SPY) $190 puts at????.?.??$3.88