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-bullis