Trade Alert - (TLT) June 19, 2020 - TAKE PROFITS-EXPIRATION

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 - (TLT) – EXPIRATION

EXPIRATION of the iShares Barclays 20+ Year Treasury Bond Fund (TLT) June 2020 $175-$180 in-the-money vertical Bear Put spread at $5.00 or best – Trade No.3

Closing Trade - NOT FOR NEW SUBSCRIBERS

6-19-2020

expiration date: June 19, 2020

Portfolio weighting: 10% down to zero

Number of Contracts = 24 contracts

Assuming that the (TLT) does not rise $18.33 by the close today, our position in the iShares Barclays 20+ Year Treasury Bond Fund (TLT) June 2020 $175-$180 in-the-money vertical Bear Put spread will expire at its maximum expiration value of $5.00.

My bet that massive over-issuance of US Treasury bonds to fund $6 trillion in stimulus programs proved correct.

By coming out here, you get to take home $1,320 or 12.36% in 30 trading days.

The fundamentals of this trade are very simple. With the national debt already rising from a record $26 trillion to an eye-popping $32 trillion by the end of 2010, the US Treasury demands on the bond market are going to be incredible.

It is almost mathematically impossible for bond prices to rise. They can only go sideways at best, or down big in the worst case. Sounds like a great short to me.

If you have the ProShares UltraShort 20 Year Plus Treasury Bond ETF (TBT) outright for a medium-term investment, keep it.

This was a bet that the (TLT) would not rise above $175.00 by the June 19 option expiration in 30 trading days. To lose money on this position, ten-year US Treasury yields would have to approach 0.30%.

Here are the specific trades you need to exit this position:

EXPIRATION of 24 June 2020 (TLT) $180 puts at………...…$18.23

EXPIRATION of short 24 June 2020 (TLT) $175 puts at……$13.23

Net Proceeds:…………………..........……….………..………….….....$5.00

Profit: $5.00 - $4.45 = $0.55

(24 X 100 X $0.55) = $1,320 or 12.36% in 30 trading days.

Legal Disclaimer

There is a very high degree of risk involved in trading. Past results are not indicative of future returns. MadHedgeFundTrader.com and all individuals affiliated with this site assume no responsibilities for your trading and investment results. The indicators, strategies, columns, articles and all other features are for educational purposes only and should not be construed as investment advice. Information for futures trading observations are obtained from sources believed to be reliable, but we do not warrant its completeness or accuracy, or warrant any results from the use of the information. Your use of the trading observations is entirely at your own risk and it is your sole responsibility to evaluate the accuracy, completeness and usefulness of the information. You must assess the risk of any trade with your broker and make your own independent decisions regarding any securities mentioned herein. Affiliates of MadHedgeFundTrader.com may have a position or effect transactions in the securities described herein (or options thereon) and/or otherwise employ trading strategies that may be consistent or inconsistent with the provided strategies.