Sold the Mar115/120 credit put spreads for .80 credit x10 =$800 credit
Bought spread back for .13 x10 = $130
Profit on trade = $670
Trade summary- entered on 24 feb as posted below, used 124 as support line, stock dropped on one day down to the 120short strike..still had plenty of time to let recover, again this is why i dont use stops on spreads..would have gotten stopped out / shaken out on that day..stock recovered and resumed trading within the channel. closed today on quick opening pop to 128.. so got alot of time decay, a few points price appreciation and spread reached 85% of max gain with 4days to go. now the risk reward has changed and only $130 is left in the trade..better to take the profit, especially if something wacky comes out of FOMC this week.
Also if youve been following me on this name, this is the 2nd spread ive done on FFIV for Mar opex. previously had 105/110 that i took profits on 23feb...there was only .14 left in that spread and had 77%gain..by taking that gain i was able to use that same buying power and make another profitable trade vs trying to let the orginal spread expire worthless and not have to pay commission..so doing that made me an additional $500 on FFIV this month... Takeaway is to take your profits at 75% + of max profit...you only make a few pennies more if stock keeps going up anyway
29 feb - as stated below i rolled the Mar110 short call to the Apr115 short call..paid $1.50 for that roll...still holding the mar115/120 credit put spreads and will roll to apr110/115 if needed. note that earnings are before Apr opex.
24feb - recently closed a Mar105/110 credit put spread for profit and looking to reenter at higher strike. Currently have a DITM leap and Mar110 short call. short call has delta above 95 so will be rolling it up and out to the Apr115 level soon..was priced at about 1.50 debit to make that roll. so heres the thought process.. still have plenty of time in March opex, stock has been holding above the previous breakout level near 123 for few weeks. Level im shooting against that will give some support is that 123 breakout level, safer level would have been 115/110 but wanted more premium than was being offered on those. worse case is that stock pulls back to 115 or lower. if so then will roll that spread down and out to APR 115/110 spread...but will also have the short 115 call hedge working for me if i have to roll down and out. Getting decent premium at this level with 75% probability of max profit using the Trademonster Analyse Tab. The stock along with other cloud companies have been strong fundamentally as well. Additionally, if i have to roll to Apr115/110 then that 115 level will get me under the 50 day moving average for some support.
Sold the Mar115/120 credit put spreads for .80 credit x10
