Trade Update - Kellogg
Trade Update - Kellogg (K) Hello Smart Option Sellers! Before we get to the trade update, I want to remind everyone again to please mark your vote about the potential new option credit spread newsletter service that we've been discussing. You can only make your vote by using the alert from Friday August 17, Issue #291. Open that alert and click the link for your choice. If you've recently joined us after August 17, you can read the alert in the archives but you cannot vote from there. Just shoot me an email and let me know your choice. Thank you! Now, onto yesterday's trade... We were successfully filled on the new Kellogg put-sell trade from yesterday. The only downside though was that it moved out of range very quickly. Fills came across between $.25 - $.29 per contract, so we'll take the official mark at $.27 per. Some of you wrote me about your fills at $.28 per contract. Here's what we did: Sold (sold-to-open) the K January 18, 2019 $55 put options for an official sale price of $.27 per contract as an opening transaction (sold-to-open). I know the trade went by fast, with some of you not being filled. Unfortunately, the options markets aren't as deep (volume-wise) as the stock market. That is why it is imperative that you stick with my guidelines on what price to sell the put option for. I hope no one sold it at $.20 per contract yesterday. That was a no-no! When you do that, it only emboldens the market-makers to keep their bid prices low. If they know someone will sell it to them at $.20 per contract, why on earth would they pay up to $.25 per contract? They won't and they don't. Let's be smart and make them come to us. I understand that in the short-run, we'll put a little pressure on the market with our rush of sell orders, but if the stock drops a bit at this point, the rest of you should be able to get the sales done. We know at the time of the trade yesterday Kellogg stock was at $71.50 and the put option had a $.25 bid/$.35 offer. There's no reason to believe those option prices won't move back up if K stock drops again. Be patient, and keep your sell order working "GTC" for at least $.25 per contract or higher. That's all for now. Continue to hold all other positions as-is. Contact me here Regards,
Lee Let's Grab That Cash!