3/7/2021 Plan:
A few trade ideas this week, including a put spread in Salesforce.com (Ticker:CRM)
3/7/2021 Plan (continued):
- CRM – Sell Mar 19 195/190 put spreads for 0.50
- JWN – Sell Mar 19 30 puts for 0.35
- PG – Sell April 9 120/117 put spreads for 0.34
- Prices are as of market close 3/5/2021, actual fill and strikes may differ depending on Monday’s open, post will be updated accordingly.
- All trades are for educational purposes and do not constitute advice
3/7/2021 Commentary:
Salesforce.com has dropped quite a bit recently and had a nice snapback on Friday, never dipping below 200. We sell the 195/190 with the assumption it holds this bounce back after being oversold. The spreads are a bit wide, so we’ll monitor and adjust as needed when the market opens, potentially going a bit further out in time or increasing the strikes (but no higher than the 200 strike).
Nordstrom (Ticker: JWN) has had decent support at the 30 level. This is more speculative in nature and no harm in passing if you don’t want shares long term. I’ll be pretty flexible with the expiration on this one.
We take a another look at PG this week, with even lower strikes than our 124/121 that expired this past Friday. This is a straight forward put spread that assumes PG moves less than ~$6 down between now and expiration. As these ‘stodgy’ names often get bought in a sell off, I like it against some of our more speculative positions (RKT, DKNG, etc.).
Markets are Still volatile – so as mentioned in the past, it is ok to take some time off to re-assess. I’ll keep providing recommendations, but do not feel obligated to use them – placing trades in volatile markets often leads to more volatility in your P&L.
Reach out with any questions on this or any other trade!
3/8/2021 Entry:
Sold Apr 9 120/117 put spreads in PG for 0.35
Sold Mar 26 195/190 put spreads in CRM for 0.55.
Sold Mar 26 30 puts in JWN for 0.32.
3/14/2021 Update:
Our PG put spreads are down to 0.20 each, for a profit of $15/spread. I’ll be leaving them on for the week, unless there is a big downturn (at which point I’ll pull them for a small profit).
Our CRM put spreads are looking great and are only worth 0.16. This is a candidate to take off to book the win as it will take 2 weeks to get that last 0.16. I’m personally leaving them on, but if you need to reduce risk, take a look at this one.
Depending on your platform, it may show our JWN puts being worth 0.92! Don’t worry, this is just a wide bid/ask and they are worth substantially less. You can see this because you can buy the 35 put at the ask for 0.49. These are very far OTM and you can try to close them for a few cents or simply hold for another couple weeks.
3/21/2021 Update:
The CRM put spreads expire this week and are far out of the money, currently a nice winner. Take them off at any point this week to capture the profit
We have more time on the PG put spreads, also profitable, worth about 0.11 right now. I’m still leaving them on, but as you look for places to capture profit/reduce risk, feel free to take these.
The JWN puts expire this week and are also far out of the money. Remove when you’d like this week or let them (likely) expire worthless at the end of the week.
3/28/2021 Update/Partial Close:
The JWN puts expired and we took in the full credit of $32/put. The CRM put spreads also expired worthless, bringing in $55/spread.
The PG put spreads have another two weeks, but are down to 0.06. Consider closing around here to book the win. If not, keep an eye on it to prevent a big winner from becoming a loser.
4/4/2021 Update:
The PG put spreads are nearly worthless, and the short portion can be bought back for just a few cents. We are over $14 out of the money – more than 10% – and these will very likely expire worthless. To remove risk from your account, buying back the shorts for a couple cents makes sense (sorry that was a borderline pun…), especially if the downtrend in PG continues much further.
4/10/2021 Close:
The PG put spreads expired worthless allowing us to take in the full $35/spread sold. As we risked $265 per spread, that’s a return of over 13% in about 1 month! This was a pretty easy to manage trade with PG moving steadily up after we put it on. Enjoy the win and Reach out with any questions on this or any other trade!
