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 – (SPY)-BUY
BUY the S&P 500 SPDRs (SPY) July, 2017 $245-$248 in-the-money vertical bear put spread at $2.53 or best
expiration date: July 21, 2017
Portfolio weighting: 10%
Number of Contracts = 40 contracts
This is a bet that the (SPY) will not rise above $245 by the July 21 expiration date in 15 trading days.
If you can’t do options buy the ProShares Short S&P 500 ETF (SH) for a trade only. I still believe the medium term direction of the stock market is still up.
Do not pay more than $2.65.
I think that as long as we are stuck in gridlock in Washington DC, markets will remain trapped in tedious, hair-tearing-out, narrow ranges.
Also preventing any action whatsoever are a number of impending congressional breaks.
This position also acts as a “RISK OFF” hedge against my existing long positions in (AAPL), (FB), and (BIIB).
To see how to enter this trade in your online platform, please look at the order ticket below, 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 a Vertical Bear Put Debit Spread by clicking here at http://members.madhedgefundtrader.com/ltt-executetradealerts/.
You must be logged into your account to view the video.
Please keep in mind that 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.
Here are the specific trades you need to execute this position:
Buy 40 July, 2017 (SPY) $248 puts at……………………….$7.00
Sell short 40 July, 2017 (SPY) $245 puts at……………………..$4.47
Profit: $3.00 – $2.53 = $0.47
(40 X 100 X $0.47) = $1,880 or 18.57% profit 15 trading days.