Follow me on Twitter!

Friday, May 4, 2018

SPX CREDIT PUT SPREAD

Friday, 5/4/2018 (9:52:06 am, PT)

sell to open -2 May 4, 2018  2650 puts at $2.15
buy to open +2 May 4, 2018  2605 puts at $0.10

Facts:

  • credit:  $2.05 = $410 max profit
  • delta for short put:  28.42 (> 70% chance of success)
  • margin requirement:  $9000
  • expiration day:  May 4 (same day)


Why did I place this trade?

  • SPX was trending up in the morning (strong trend)
  • this is a same-day trade to take advantage of theta time decay



Friday, 5/4/2018 (12:41:37 pm, PT)

buy to close short puts at $0.05
let long puts expire worthless (sacrifice of $20)

Note:  SPX closed at 2663.42

TOTAL PROFIT:  $400 (in 3 hours)  .....  4.40% ROC





LEARN TO SELL PUT OPTIONS