Yes, Time For A New Trade!
New Trade! Hello Smart Option Sellers! Not much has changed since my last alert where I mentioned that we're sitting pretty with our current positions as they're all in profitable territory. In the current bull market environment, it not only gets harder to find good new put-sell trades, but it makes it just as hard to pull the trigger on outright stock buys. Everything just keeps going up and who wants to buy at the top? But is it the top? If you don't buy today, will you miss out when it goes up tomorrow? Who knows. But, I do know that we need a correction at some point. The million dollar question is when does it happen? In order to be successful with investing, I've found that it's easier to just go with what the market gives, instead of trying to predict where and when it will move. You'll miss out on too much if you try to predict all the time. The good thing about selling put options is that we play it with a downside buffer on our side. If the market corrects, we have cushion for downside action. That's why we try to choose strike prices that are 20%-30% out-of-the-money (OTM). With that said, let's jump on a new trade. Merck & Co (MRK) MRK stock is currently trading around $63.70 per share, and has been stuck in $4 trading range between $62-$66 per share since February. See the current chart here. Although MRK releases earnings on 10/27, I don't foresee a huge move to worry us about establishing a new position prior to the event. We've already played MRK successfully in our portfolio and we're getting in at almost identical circumstances. We entered a put-sell on MRK back on March 23, 2017 when it was trading near $63.50. We used a six-month option and sold the $47.50 put for $.35 per contract. Today's trade will be very similar. Here's what you can choose to do: Sell (sell-to-open) the MRK April 2018 $47.50 put option for a limit sell price of $.25 per contract or higher, GTC, as an opening transaction (sell-to-open). Currently, this put option has a market of $.28 bid/$.34 offer, so we should have no problem selling it for more than $.25 per contract. Remember, try to place your sell order in between the prevailing bid/ask price when you enter the trade. You do not need to sell right at the bid price. You can get more! Ok? With the stock at $63.70, this gives us a nice 25% cushion above our $47.50 strike price. That's $16 of downside protection for us. Get those orders in and let us know how you do. You can reach us here That's all for right now. Regards, Lee Let's Grab That Cash!
Current Portfolio Continue to work all other trades as instructed and continue to hold all other open positions as-is. See the Current Portfolio below for current prices & instructions. Note on the Current Portfolio - if you are a new subscriber and don't have a position yet on any of our trades, make sure you enter your order at the original recommended sell prices. Do no enter any order unless the current option price is at, or higher, than the official recommendation. If you are unsure or have any questions, please ask us!
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Warren Buffett Report I continue to get good feedback on this report, so I'll keep this notice going for the time being so everyone has a chance to see it. If you need the link again, click here to read about it.
