Trading a Smaller Account | Barbara Armstrong | 1-15-21 | Bullish Strategies
all right good afternoon everyone good afternoon uh welcome to the weekend we've got a long weekend coming up my name is barbara armstrong this is trading a smaller account so who should be in this class well regardless of the size of your account whether you're just starting out you have a very modest amount or you might have one two three million dollars and you want to trade a smaller portion of it this is a class where we trade actively so every week in this class we are going to be putting trades on in the weeks to come we're going to be managing the trades we've placed and so this is an intermediate level class i assume that you understand some basic options strategies if you don't not to worry today may be a bit like drinking out of a fire hose but keep coming back i will put links in at the end of this class to introductory level classes on the options strategies that we teach okay here that we talk about today all right so stick around lots of great stuff coming your way we've got 45 minutes together and i can't wait [Music] oh you know what let me bring up my powerpoint for us to start so i did say this was a very interactive uh community and it is um and i can see that there are already lots of greetings and stuff in the chat so hello to izzy and anthony and henry and white belt investor which i love that handle by the way and charles and gloria and and the many many others also thank you so much to mike fairborne for joining us in the chat today because mike brings a wealth of experience with him and so if you have questions between mike and i we should have answers now if you're saying hey just a minute i'm watching this in the archives which thousands of people do if you have questions you can either type them into the comments on youtube or you can reach out to me by replying to a current post that i have posted on twitter so how do you find me on twitter right over my head at the armstrong underscore tda i'm posting content on a daily basis lots of interesting stuff you won't want to miss tips on how to handle the platform interesting stock configurations and just news about investing i only really use it for my investing world i throw a little bit of humor in there sometimes in the evenings and mike does the same thing so you'll want to follow mike as well at amfairborn underscore tda so there are questions that came in ahead of time also so i'm going to go through our important information at the beginning and then i'm going to scroll through and answer a couple of questions and then we're going to get started so i know that's not the usual and then halfway through i'm going to pause again and just go back and make sure that i've addressed any questions that maybe mike um couldn't address because it may have been tough to answer um in the chat okay so first of all know that options they're not necessarily suitable for each and every investor options carry special risks with them we discuss those risks every single time we place a trade in this class but it's important to understand that also know if you're new to td ameritrade so is there anyone that's brand new if you're brand new please type that in so we can welcome you but know that you have to apply for option trading privileges when you open an account with td ameritrade also know that in order to demonstrate the concepts we want to talk about and the functionality of the platform we need to use actual symbols so and we use lots of them in this class but that's not to be construed on as a recommendation on the part of myself or td ameritrade the decisions you make in your live account that's on you my friends but i encourage you to follow along and and place trades in your paper money account um so that you can kind of get the hang of all this and know that in spite of everything we may do to try and stack the deck in our favor all investing involves risk including the risk of loss so we have to understand that right right okay so this always looks so teeny tiny and yet i always have this jam-packed agenda i really want to cover with you we always start by having a super quick look at the market forecast you know what's happening in the market is it bullish is it neutral is it bearish then we're going to look at our current position so now that we're starting at at one o'clock mountain or three o'clock eastern we get the entire class in before the market closes so yippee so we're going to start with the way most people would manage their portfolio is like let's manage what i have first and then look let's look at what i might want to add so that's what we're going to do we're going to add if you weren't here last week we're going to i'll put a link into last week's class and you can always watch that afterwards um okay so one of the first questions and let's just come out to the platform was how how do we define a smaller account so some people may not think this is so small but we're saying that we have a twenty thousand dollar account to start our maximum risk per trade is four hundred dollars and our maximum position size is five thousand dollars now last year we spent most of the year together we started with twenty thousand at the end of the year we were up almost fifty percent and then we just wiped the slate clean which kind of brought a tear to our eye um but you know we're starting again okay and so those are the rules and we've level set them now as the account balance changes goes up or could go down you know we may have to alter our position size and our max risk per trade up or down right there's another question about investors pouring money into into uh sectors and you know how to figure that out so i did a class yesterday this is a question in the chat by trine and and i spent a lot of time on that it's building blocks uh for a self-directed portfolio and although i spent most of the class on it here's the quickest way to do that is uh well i play music while i'm getting ready so now you know today it is ed sheeran um but the quickest way to do that is to sign into td ameritrade.com come over to research and ideas down to sectors and industries and i did this before i prepared for this class why did i do this because i'm always trying to help us stack the deck in our favor so how do we do that well one of the ways is i come over to the market monitor tab and i say okay mr tab it's like you know my little genie in a bottle and i come over to change time frame and then i say which sectors have been leading for the last 90 days okay energy financials consumer discretionary materials top four how about the last month financials energy materials look familiar it's the same four and consumer discretionary so if the market is moving bullishly and let's go answer that question then if we want to stack the deck in our favor perhaps we want to look for stocks that are in these sectors because these have been the strongest sectors within a market that has been recently hitting all-time highs how recently well as recently as this week my friends so if we look at the s p 500 here's a nine month chart obviously has been up trending came out when we coming up close and personal has you know hit a new all-time high on the 8th that was last friday and then has been kind of hanging out today you know pulled back a little but where did it pull back to oh the 10-day moving average it's still quite helpfully above the 30-day moving average and in this class we often right at the beginning of the class we will come and we will load something called the market forecast and if you want this i have this pinned to the top of my twitter feed and the deal with the market forecast line and it's pretty obvious that it's going to be bullish for those of us that look at the markets every day because it's sitting within a stone's throw of an all-time high you know that it posted just a week ago so if it's in between this 20 and the 80 line and up trending or anywhere in this range above this 80 line which it has been in for quite some time now so do we have permission to take bullish trades according to this market forecast the answer would be yes so i hope that answers your question if you want more detail and then to look at how to find stocks we did a search and we did all of that in yesterday's class um the building blocks for a self-directed portfolio so i would um go and check out the archives on that okay um and again i talked about trading balance and and small account and it's relative like if you're warren buffett small might be 10 million you know to me 10 million would not be small yeah okay so i'm just going through just making sure i am not going to cover scans today but there are many classes that do and i did a scan yesterday in that building blocks for a self-directed portfolio so juan there's a question about can i show you how to create scans okay okay okey dokey so and you know when we kind of look at this and there are a couple of questions that's like things are are falling well some might look at this as kind of a a bull flag and a stiff wind like it's still up trending it's still above the 10 it's still above the 30. um so they wouldn't necessarily look at this index and think wow this looks like it's turned bull bearish a two-day pullback does not a bearish trend make now if it keeps on falling that can change could it it absolutely when we come to the nasdaq this is a tech heavy index um and no financials but about 50 of the stocks are our tech and so again we can see you know still easily above the 30-day moving average just sitting kind of like a bird on a wire on the 10 still within what i would call a stone's throw of the all-time high that was posted last friday and we're just seeing some consolidation so you know even in an uptrending market it doesn't tend to go straight up it goes up and it'll pull back a bit and then it'll go up again and it'll pull back a bit so it's it's kind of like a wave no okay but you know could this if it closes below the 30 do we want to pay attention yeah absolutely is it there yet no okay so last week we put on four trades so the first trade was a stock called lkq and if you're not familiar with it um it's a consumer discretionary stock we talked a bit about it auto parts so we we got into this trade so obviously been up trending it's more than doubled in price in the last nine months and it recently broke out so last friday we entered the trade here we could have thrown our shoulder out for patting ourselves on the back on tuesday because it had a big move to the upside and now it's come back and retested old resistance becoming new support are we surprised by this no my friends we are not this often happens so if we come to the monitor tab it may look like we're down yeah we're down 30 dollars on this but is that cause for concern no do we have an exit already in place for this yes we do if we want to see where that is we can come up here and we could say show us our orders and it would show us where our stop is now we put our stop below this recent low now if this breaks below this line we could move that up but we entered this trade knowing that we didn't want to risk more than 400 and we will not be risking more than four hundred dollars even if we were stopped out okay so that was our first trade second trade was a stock called apps now apps digital turbine company we bought the stock this is called the buy rate we bought the stock and we sold the covered call against it so even though apps pulled back today almost two dollars a share we are still up by 327 on this trade and what we did is we sold the 60 call the goal is to get called out the goal is at the end of this 35 days to end up having the position taken from us because it's gone above 60 dollars as long as it doesn't go above 63.70 we were ahead to have sold the call so if we come and we look at apps we can see and i didn't put a little circle around this and and sometimes you know it just makes it easier for us to see and i'm going to get rid of these notes because they're kind of distracting we're going to apply so if you want to mark down when you entered a trade last friday was january 8. we got in
right here this is our buy right now some people get pretty sophisticated so for a buy right they may make that circle purple if you wanted to make it a different color you can come here edit properties and say okay i want my by rights to be purple in color and then you'll know that you've got a by-right you can also draw a line on the chart so we could take this line and change it and we'll change it to 60 because that's where our buy right is from and if we wanted to put this trade on the chart we could write down by write if i could type at 60 and this is february 19th is when it expires and say show us that on the right so as soon as we come and look at the chart we know what position we have on and i believe it was the 60. and so that's just kind of chugging along and doing exactly what we wanted it to do okay then we sold a short put vertical on apple and that's currently underwater a teensy bit um it came up 41 today we're two dollars in the hole on that and what did we sell well we sold the 125 put so we did the 125 and we bought the 123. so if we come and we look at apple this is where we want the goal is for the stock to stay above this and so today it's just kind of sitting on that 30-day moving average if this ends up breaking below and particularly if it comes below this low we might decide to exit this and may perhaps take a small loss now if we take a max loss on this the most we could lose on this trade if the trade did go against us and i mean right now we're just saying okay we're just going to let time continue to work we have two weeks left so we're one weekend um and we were paid 54 cents so we're risking about 300. 292 if you
want to get specific um timothy is asking if the market forecast indicator is custom the one i'm using is it was created by ken rose and i have that pinned to the top of my twitter feed but you can also there are others that look similar that you can just go to edit studies and type in market forecasts and there are several other indicators you can use now the last one we had was snap so with snap we sold a put at 50. and this is one that i believe we'd had in our portfolio before and we looked at this and said would we be willing to buy this this one has so we bought this last week it went up like so many other things did in the last two days it's kind of come back down around this support level and then today what do we see well we have an inside day which is a bullish uh which is a bullish sign and so is there any need to worry not necessarily but i i drew this 50 put on here but we've got time so those are the four trades that we put on last week now if you missed it and you said i'd like to replicate these in my account well you can look at that and say okay well if you put on that short put today you'd actually get paid a little bit more for it than we did um and so that could work out in in your favor in your paper money account if you wanted to do that and this sign that we're seeing here this technical indicator this inside day this harami at a support level which is where this is occurring is considered bullish and doesn't require confirmation now a more conservative investor may say well it may not require that but i'm waiting to make sure it goes up monday and another person might say i'm willing to go in and take the trade okay so that's what was already on the books let's move on to the new stuff so i'm going to start today with nike because i had to give up on my crocs like last year i checked we started trading that last year at 29 a share and sadly it's now at like 70 something or something like that and um so you know it's it's now out of our snack bracket and that last year was our bread and butter um so anyway i'm just kidding but we're coming over here to nike and you might say well did you fall and hit your head remember we can't buy a stock you know we could buy a few shares of this but it's 141 dollars a share so what we're going to do on this is look at a short put vertical so if i take a look at you know the low today which would be the first level of support you know that's around 140. well could i come back here you know our 30-day moving average which would be considered another level of support that's around 140 also and then if i come back here to this previous low that's around 138 8 35 so if we come to the trade tab we could say well could we get enough premium at 138 if we went out 21 days so we're looking at a weekly what's the advantage of a weekly we have more strike prices often than the monthlies the disadvantage is sometimes the bid ask spread is a little wider well here it's six cents on a 260 option um so are we super worried not necessarily you know it still would meet our criteria and is there enough volume here well not the kind of volume we were used to seeing on neo but you know it's got 10 times or 20 times the volume and the bid ask spread is acceptable so if we come and we say let's sell a short put vertical and if we make it a two dollar wide strike whoops 138 136 we get 55 cents doesn't that meet our investing criteria and so if on a short put vertical we say okay we want to look at return on risk and so we're going to come here switch our gadget and bring up our calculator and say what are we risking well we're risking a dollar 45 so if i take 55 and i divide it by a dollar 45 that's a 37 return so some might say no matter what i want 25 some might say 30. some might say hey if i'm in this for 21 days because sometimes you might be in it for a shorter or a longer period of time so to kind of make it more apples to apples they might say i want at least one percent for every day i'm in the trade well whatever your requirement is at a 37 return for a risk it's met all of those how many could we do we could do two because we can't risk more than four hundred dollars we're going to put our exit in why because we all have busy lives and so we're going to come up hit first trigger sequence right click and we're going to create an opposite order and say you know what when we've got about 90 of our max gain we want to take our risk off the table so when this is worth about 6 cents i round it up to 60. um shut it down buy it back okay and tim i see your question and i will get to it i like that because i asked myself that same question today and thought we would address it in this class so we're going to put that in our short put vertical bucket and the next one we're going to do is another short put vertical on another stock that we couldn't afford to do a synthetic on or a buy right or outright buy the stock or you know we could buy a few shares of microsoft but this one's even pricier than the than the last one you know it's 213 bucks a share and with microsoft if we come out and we look at the charts and we say okay so we've had what do we call this pattern so feel free to type into the chart um into the chat you know what do we call this where we have a series of higher lows but then we've had a few lower highs right and it's sitting on the support level and what's it doing today my friends ah it's bouncing and it's an inside day in that the body of today's candle is inside the body of yesterday's candle so if we look at this and say okay that's a bullish setup at a support level in this pennant pattern right could we what was the low of today's candle 212 what's you know our support level line well that's at around this 212 level you know could you know here's a previous support level where's that around 212 how about this one over here you know that's around the 210 right so we've got a rising wedge or a pennant pattern so could we come out and sell something around that 210 which would be below today's low so one level two level that's kind of at a third support level because i kind of look at it this way you know my kids when they were young played a lot of medieval history games with their grandfather and had all these nights i see every support level as a row of knights with shields protecting my short put from being run over now do we end up sometimes having that not work out yes sometimes it doesn't work out um but there's a question about a married put in the chat i'll answer that in a second um a married put is where you buy the stock and you marry it by buying a put at the same time as a means of protecting that stock if i'm not mistaken so but we're on short put verticals right now okay so short put vertical we're going to look at the 210 again we're looking at that 21 day time frame so why are we looking at 21 days because if we went out farther we might get more premium that's true but time decay really starts accelerating and we are selling something we're getting paid up front and what do we want it to do expire worthless do we want it to wait until it expires to to get out not necessarily like next friday if we have 70 percent of our gain we might say hey we're only a third of the way in we got 70 percent over 80 of our money i'm gonna take it and thank you know the trading gods and you know put that money in my imaginary pockets and and pocket that imaginary gain and you know rather than risk losing it for that remaining 10 or 20 percent so if we look at this 210 and again you know it may be the weeklies but you know when we look at the volume on this we have 1100 contracts that were traded today so we were the only ones that thought 210 looked interesting um for the puts on you know a february 5th expiration on microsoft we are not alone and there were 3 000 contracts on the books first thing this morning so uh yeah we are we are not alone my friends oh sorry i've already brought this up so the 210 now this one is a 250 wide strike we're getting paid 88 cents so if i take a look at 250 and i'm going to subtract 88 that's a dollar 62. that's almost 50 like holy smokes 88 divided by 162. that's what we're risking
that's a 54. oh when is earnings i thought i checked that uh october november december january 27th it could be but it's not showing on the chart and this is february 5th so if it's oh yeah you're right guys somebody i cannot place a trade today for love nor money we wanted to sell this if you go too quickly like if i clip the edge it flips it so we wanted to sell so this could turn out this isn't a long put we are the intention here is we're selling the 210 our expectation is that the stock is going to say stay above 210. but one of the rules that we have in this class and you may choose to have that rule or not is if earnings comes between now and the expiration date we don't place the trade so i thought that was awfully juicy a premium for something trading where it was so we are not going to place that trade so this was a test you guys passed um yeah okay so i'm going to put an x beside that one and nike i believe just had earnings let's see yeah so nike we just got past earnings on that so you guys are good so we're not going to place the the microsoft trade next one i want to look at is plug now this is one that kind of broke our hearts a little bit because we had done two by rights on plug i feel like nixon i had done two buy rights on plug um bag we got interested in plug back here like when it was just breaking above this support level so this is a stock that's really taken off right um yes i am keeping you on your toes you guys keep me on my toes i gotta say and and that i really do appreciate so you know we we got in this and we did two by rights and you know we were maxed out on those because all of a sudden this stock went insane and you know what's really frustrating is you know we were happily you know skipping along trading this in this class but you know now it's what's our rule our position size can't be more than um 5 000. so what we could do is we could
look at this and say well this is coming down but if it came back to 50 would be be willing to buy it and then you know you may want to if you've not if you're not familiar with this stock you may want to come back out and do some research because you'd be if you're selling a put you could end up owning this and it is pulling back today so we can see significantly outperforming the market it is more volatile so we do know that um pretty highly rated here and you know what we may want to do is you know check check out some of these news earnings reports etc etc but when we come just to the company profile what do they do alternative energy what is one of the areas that once we get the pa past this pandemic that the next administration is going to focus on what are a lot of companies in the world focusing on is you know renewable energy alternative energy sources and so might a company like this continue to do well so if we looked at this and we said okay if it came back to 50 and you know it's kind of who knows how we look at this it may not be finished falling and so this is one of those where we may just want to kind of put it on our radar but i'm going to put this in today so that we have it in the account because if it takes off on monday um then that opportunity may be gone so we could look at okay where is the current where did it open well if it opened at 63 15 we might say hey if this hit 63 um 35 then let's sell this put at 50. okay and so what does that mean for us well right now if we were to sell this put now on plug and again you know 73 million shares traded today so this isn't some like little backwoods company that nobody knows about it is one of the most highly traded stocks and when we take a look at february and we take a look at this i mean we've got lots of action on the contracts and so if we come back to the 50 what are the odds of it being assigned to us well 24 which means there's a 74 chance that we would end up getting to pocket that 400 and you know we wouldn't end up owning plug but we'd end up 400 richer in our example portfolio and you may say well four hundred dollars that is not going to have me drinking you know something sexy out of a you know out of a coconut in tahiti but right now we can't go to tahiti and on a twenty thousand dollar account a four hundred and some dollar gain that's over two percent so you know not bad right so what we're going to do is we are going to right click and let's see if i can do this without clipping and we are going to sell a put and we're going to sell this at whatever that price is and if it now this is one guys that we have to watch so i'm going to look at this one on monday and i encourage all of you if you put this in your paper money account it's not like a set it and forget it and what did we say our number was because i didn't write it down when i come back out to the charts i said if it went above was it 60 20 somebody else write that number down okay our high on that it was oh no i don't want the high i want the open 6315 so if it goes to 63.35 we want back in okay so trade we're going to make this conditional we only want to get in if it starts going back up and some might do that so some might say you know what like i don't care if it comes down below 50 i'm willing to own this stock i'm willing to own it and i'm kind of like i'm not trying to be frugal but i'm thinking if this comes down for another day or two before it goes back up like i'm totally happy with that and i'm happy to sell a put and get paid more for it right yes and there's a three-day weekend so what's working in our favor with a three-day weekend time decay okay so i want to run a democracy how many of you want to go ahead and just put it in now and how many of you want to make it a conditional order go ahead and type into the chat you guys are quick i'm kind of appreciating this this is cool so quickly by now conditional order versus conditional order izzy is saying um theta okay i've got you so you're you're voting to just go ahead and put it in now and not make it and then we've got kirk and tim and so we're kind of split so you know what i'm going to go ahead we're getting lots of nows some conditionals so i'm going to be conservative it's the beginning of the year we're going to say if this goes above 63 35 but on monday my friends if that starts to move to the upside and you're seeing it looking positive then we're gonna go in and change it and put the order in okay okay you know what we'll do this twice this is a paper money account yeah and ricardo is saying market makers are smart they adjust the slippage to overcome the decay but you know you're taking a chance so that that theta decay is there even when markets are not open so 63.35 is our price and we want it to go above that we only want to get in if it goes above 63.35
so the votes are still rolling in so we're going to do one this way and we're going to put in confirm and send so we want to sell the 50 put on plug only if plug goes above 63.35 and we're going to put that into our cache secured puts and then i'm going to do another one and and like we did with plug where we actually where we did two different buy rights just to compare and so we're going to right click and we are just going to go ahead and sell a single and we'll just see so you guys all know what side you're on i'm not taking any notes okay so somebody said you know why don't we use theo price to see you know how much it might change by monday but you know if it not only changes but gaps up like we saw etsy do between monday and tuesday um that's where you know some might of course we have a conditional order so we'd be getting in so there we go fire in the hole so theo price this i thought was one of the coolest things on the planet the first time i saw it so when you first come you're always going to hit reset and so we're saying okay today's january 15th what if by monday nothing has happened the stock price hasn't moved but what would the value of our option be so it's you know 435 like the mark is 407. uh oh theo price 408 so sorry the mark is 440 it would be worth 408. so we we'd already be 10 ahead by monday even if the price doesn't move now this is a fairly volatile stock so one might ask yourself the question self how much does plug move in an average day so if we come to studies and we come i'm going to load a different study set i call this my basic study set but how about we throw something else on top of it and we're going to do atr oh sorry i'm going to edit this i'm just going to type in atr what does that mean it's average true range so what this says is over the last 14 days how much has this stock moved in an average day and so it's saying okay that average is about five bucks so if this thing moved up five dollars on monday or moved down five dollars on monday where would we be you know and then we could go to theo price and and you know calculate that now for a long time you know it was in that kind of two dollar-ish range but it is a more volatile stock okay so that's plug now the last thing and we have a whopping five minutes so are you ready to listen fast okay so here's the deal on the last one and this is another one that i don't know if we got to talk about this before or not um but this is blank now what does blank do charging stations right so um you know network of electric vehicle charging stations and again do we see demand for this type of thing increasing my spidey sense says yeah now could i be wrong it won't be the first time i know it rarely happens but i mean it could um but so if we look at this and again this is one you know like this thing a few months ago like back in november was at 10 bucks a share it hit 57.85 so what i did in the interest of time was i drew a couple of lines so this one you know this trend started at 26 and it went up to 56 so that was like a 30 move this was more modest so here we were starting at 36 and we went up to you know 58. so a twenty dollar move so i just took this line and if we need a little more space at the top we're going to come up to our price axis and say you know what give us another twenty percent so not two hundred twenty so we can see where this line is going so this is saying you know we're thinking this could go to 69 ish dollars now again you know what we what do we have here we have a down day today and it's not like a doji it's not like a hammer it's not any of those things and we only get to meet once a week which kind of frustrates me but i'm working on it that's all i can tell you so if we looked at this and said well you know we so much of trading is about patience and remember this is a a class where we're just trying to learn strategies and figure this out so in your live account you know one wouldn't look at this and say oh yay i've got the setup but given that we only get to meet once a week and if we wanted to put this in our paper money account how could we do it well we could say well if it goes above today's high but this is one that on monday you're going to have daily homework you would look at this and say did this start to move to the upside or did it set up a doji or a hammer where we could enter at a different price and then how do we want to trade this so this is one at 46.87
we could do a buy right on this so when somebody's saying you know is this a cup and handle setting up so it could be and that would if we looked at this as a potential cup and handle then it would say you know when when could we get in well it wouldn't be now we'd be looking to enter this only if it goes you know and for those of you who if you're not familiar with that pattern let me just draw it because we don't have the pattern yet here would be the cup here would be the handle but right now it's just potentially forming that handle it hasn't formed it yet it hasn't formed yet so we could just wait for a week or we could say hey you know if we look at this as just continuation of an uptrend and we could say here at 5539 we'd like to buy this if it goes above today's high or we could say if it breaks out above this 55 39 and then do we want to do it as a buy right or do we want to do a synthetic so what's a synthetic well a synthetic is where we sell the put and then at the same time we buy a call so the advantage of that over the buy right is that if it does go up like plug did you know we would have made just boku to box we would have made a fortune but if it just kind of hummed along and went sideways and we've sold the buy right then we still own the stock stock hasn't really lost much in value if it's just humming along go busy going nowhere and if we sold the call then we'd get to keep all that premium and sell another one so if it goes up like crazy selling the synthetic would be more profitable but if it doesn't go up quickly you know uh buying a call is a low probability trade and probably the other um the the trading strategy we had the least success with in 2020 was long calls and is it because we're just remarkably bad at long call trades it's because it's the lowest probability trade that we did you know so these are the things that we have to wrestle with but if we look at this and we say okay if we're assuming it if this does turn out to be a cup and handle and goes from 36.58 you know to 55 so call it 36 so almost twenty dollars if we're expecting a twenty dollar move to the upside that would be that would be a really nice move on a stock that's only fifty five dollars right the problem is fifty 55 is is beyond our budget to buy a hundred shares so the only way we could buy a hundred shares at 55 when it breaks above is if we sold a call against it or we could do this synthetic so i'm going to look at this and we're going to okay we're over our time so you know what the jury's out on this one i'm going to post something on monday on this stock on twitter on as an example um so you're going to have to come back on monday but either way it would be a conditional order right so here's my way of coercing you into following me on twitter and trust me if you do it before this weekend i can almost guarantee that you're gonna laugh um because um i've got some funny things to share with you so we're going to leave this one on hold but what i'd like to do is do another one of one of each we're going to do a synthetic and we're going to do a buy right and then we're going to see how they play out and then we can really more um adequately analyze the pros and the cons does that make sense you know when we see each trade side by side okay so that's our wrap for today so we actually placed two trades today we looked at five we placed a trade on nike a short put vertical so if we come to our monitor tab we can see that we did a short put vertical on nike we sold a put on plug um yes there are no classes on monday we looked at a setup for micro microsoft and you guys very in a very savvy way noticed that earnings was coming up so we decided not to place the short put vertical trade now some investors might trade it anyway because the premium's really juicy and saying i'm bullish on microsoft i'm willing to take that risk but we're trying to be conservative and stack the deck in our favor so what we have decided is not to take that risk and then um yeah so we looked at blink also and we also did a conditional order on plug so we did pack a lot in the last thing i want to point out is we were up by i think 150 dollars in this and it looks like it's pulled back a bit but even if we were just up a hundred dollars um and when i looked at it earlier it was 179 so you know a lot of things have pulled back today like look at that 124 and 187 a hundred dollars a week would be thousand dollars over the course of a year that would be a 25 return on this portfolio and if it was closer to 200 which was an hour or so ago that would translate into a 50 return so it may is feel like we're talking about little bits here you know 100 bucks here and you know like that short put vertical the most we can make on this trade and that's if we let it expire worthless is 114 dollars but if we could do that once a week that's a 25 return on our account and the rest of it could be sitting safe in cash so don't underestimate how little bits can add up over time okay guys so that's a wrap for today did we do what we said we were going to do market forecast yes did we review our current example positions yes check check check check we had four of them we checked them all we placed some example trades um thank you guys so much for joining me today yes it is a gorgeous day out here holy smokes they're building a house behind me i'll have to post some pictures of that like it's like big truck mania you know right out my second story window here so appreciate you joining me thank you so much remember everything we discuss in this class for example purposes only and know that options involve special risks know that all trading involves risk including the risk of loss and have an awesome weekend please if you enjoyed this hit the like button subscribe to this channel if you haven't done so already i didn't see a survey but if there was one my promise to you if you promise to fill it out it'll take you 20 seconds i promise to read it and we'll implement those suggestions in weeks coming forward let me know what you loved what you'd like to see more of all of that it's a long weekend coming up have an absolutely fabulous but safe time please no hugging no kissing no high-fiving anyone unless there's somebody that you hug kiss and high-five day-to-day so take care of my friends we will see you in a webcast coming up soon bye for now thanks also to mike fairborne you were great in the chat
2021-01-22 17:23
