top of page

Friday Update

Friday Update Hello Smart Option Sellers! Happy Friday! As many of you might know, historically, September can be somewhat of a tough month, as the markets typically tick lower. In my personal opinion, I think it's a last gasp sell from the summer doldrums before the typical end-of-year rally. October through December can be some of the strongest months for stocks. Where does that leave us currently? At the moment, we have seven open put-sell positions in the account, all of which are in the green. As you look at the current price of each position, you want to see it going down, not up. Why? (and everyone should know this!) Because since we sold the put option as our initial entry, we make a profit by buying it back at a cheaper price. Hence, we want to see a decline in its value. Easy! As it applies to the direction of the market, when stocks move higher, put option prices move lower. This is our ideal scenario, and one which I think will play out perfectly as we move into the last quarter of 2018. Many of our put-sell positions will be initiated when a stock is on a down-swing. This helps us sell the put options at favorable levels. If my chart reading and timing works as I intend, we should see the stock rebound somewhat quickly over the ensuing days and weeks. This will allow the put option price to decline, putting us on the path to profitability. Look at our most recent play on Big Lots (BIG). We jumped on the position when it gapped lower which was due to its unflattering earnings announcement. The stock at time of initiation was roughly $41-$42 per share. The put option traded up to a high of $.50 per contract. Our official sell price was $.38 per contract. The stock has now moved up to $44 per share and the put option has moved down to about $.28 per contract. This is how we operate - we sell the put on a stock's down-move and buy it back after the stock rallies. Since put-selling is a directionally neutral-bullish trade, some might see it as counter-intuitive to get into a trade when a stock is falling. I disagree. As long as the gap lower can be seen as a one-off temporary move, it is an ideal scenario for us. Also, it has to be on a quality stock. We stick with the best of the best. So as I wait to find more opportunities for us, we'll continue to hold our current positions as-is and watch the money roll in. I don't have any questions to answer today, but I do want to address the survey for the option credit spread service that we've been discussing. I have received emails from a few of you who have said they can't find the survey or don't have the original alert anymore. Since the survey was only usable within the original alert, I will post it again below. For those not paying attention - we've been talking about possibly creating a new option service composed of selling put-option credit spreads. It is a similar strategy to put-selling in that it collects cash upfront. It also takes advantage of a neutral-bullish market. The difference is - it entails two option trades in one - a purchase and a sale. This "spread" allows the position to have both a limited reward and a limited risk feature. This benefit can insulate you from a market meltdown (not saying that will happen), as your loss is fixed no matter how far the stock may fall. In addition, the margin requirements can be much smaller than the straight put-sell, which can help those with smaller account sizes. I would suggest re-reading the alert from Friday August 17, 2018 if you still have it. Or, you can find it in the Archives on the website. You cannot register your vote from the archived version. So, if you have not voted on it yet, please use the survey below to mark your choice. If you have already voted, please do not vote again. When I get the results, I will double check to make sure there has not been any double dippers! In fact, I think my software won't let you vote again (as long as my computer skills set it up properly!) I'd like to get a final count by the end of September, so if there's enough positive results, we can move forward. I'm also still working on a short white paper to explain the system in more detail and will answer many of the questions that have been sent in. Here's the survey (note: the survey will only work in the original alert): What is your level of interest in a new put-option credit spread newsletter? Very interested Not interested Not sure Tell me more Click only one of the links above (and only once please!) to register your vote. I will give an update in the near future. That's all for today. Have a great weekend! Contact me here 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!

Recent Posts
bottom of page