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)-TAKE PROFITS
SELL the iShares 20+ Year Treasury Bond ETF (TLT) June, 2017 $126-$129 in-the-money vertical BEAR PUT spread at $2.78 or best
Closing Trade-NOT FOR NEW SUBSCRIBERS
Expiration Date: June 16, 2017
Portfolio Weighting: 10%
Number of Contracts = 39 contracts
The latest string of data reports have told us that the economy is slowing and inflation is falling.
Not only is a much promised 3% growth rate impossible, even 2% is looking unlikely as well.
Virtually all asset classes are confirming this, with oil and commodities falling, while gold and bonds rise.
Only stocks are out of line, sitting here at all time highs.
But even they are driven only by standout single names, like Amazon (AMZN), NVIDIA (NVDA), and Tesla (TSLA), all of which hit new all time highs this morning.
Most stocks have gone nowhere or fallen.
This all puts the expected and signaled June 13th Fed interest rate hike at risk.
I am therefore taking a small 9.01% profit in my position in the iShares 20+ Year Treasury Bond ETF (TLT) June, 2017 $126-$129 in-the-money vertical BEAR PUT spread and going to 100% cash.
It would have been better to take a larger profit on Friday, but it is hard to send out Trade Alerts from 39,000 feet over the Pacific with no WIFI.
If you bought ProShares Ultra Short 20+ Treasury Bond Fund (TBT), hold it for the longer term.
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 about how to execute this options spread, please watch my training video How to Execute a Vertical Bear Put Spread.
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.
Dont 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.
Please keep in mind these are ballpark prices at best. After the text alerts go out, prices can be all over the map. There is no telling how much the market will have moved by the time you get this email.
Paid subscribers, be sure you've signed up for our FREE text service for Trade Alerts. When seconds count, this feature offers a definite trading advantage. In today's volatile markets, individual investors need every advantage they can get.
Here Are the Specific Trades You Need to Execute This Position:
Sell 39 June, 2017 TLT $129 puts at . $5.45
Buy to cover short 39 June, 2017 TLT $126 puts at
Net Proceeds: .. . .....$2.78
Profit: $2.78 - $2.55 = $0.23
(39 X 100 X $0.23) = $897 or 9.01%.