9/5/2022 Plan:
This week we look at Crowdstrike (Ticker: CRWD) – warning, risky trade
9/5/2022 Plan (continued):
- CRWD – sell the Sept 30 140/135 put spread for 0.45
- SPY – sell the Oct 7 420/425 call spread for 0.53
- Prices are as of market close 9/2/2022, actual fill and strikes may differ depending on Tuesday’s open, post will be updated accordingly.
- All trades are for educational purposes and do not constitute advice
9/5/2022 Commentary:
A simple put spread this week, but please note it is in a Volatile name. With CRWD trading over 172, this trade assumes it won’t drop more than $32 in the next 4 weeks. This is a riskier trade given how much CRWD can move, so no harm in passing. In fact for most traders with the market dropping some more recently, I would suggest sitting this week out or looking to sell some calls in underlyings you have or some call spreads (like our recent AAPL win).
As one way to sell a call spread, you could do it in SPY ~5 weeks out and sell the October 7th 420/425 call spread for 0.53. Often if the market rallies this much in 5 weeks, your other positions will do so well that a small loss on a call spread will be happily taken. If the market stays flat or continues to drop, you’ll pick up some extra cash.
Feel free to Reach out with questions on this or anything else!
9/6/2022 Entry:
Sold Sept 30 CRWD 140/135 put spreads for 0.47. Sold Oct 7 420/425 SPY call spreads for 0.48
9/10/2022 Update:
The CRWD put spreads have already dropped to 0.10. Given we have 3 weeks, taking them off and booking the profit is fine. I’ll probably go until later in the week and see if I can take them off cheaply.
If you put on the SPY call spreads, they moved against us. Not unexpected given the move up in the market. It is worth 1.15 right now. I’m sized and ok with losing the full amount as my overall portfolio will be much better off if SPY continues above the 420 level. This is consistent with the commentary prior to putting on the trade. If you can’t say the same, then feel free to cut losses.
9/17/2022 Update:
If you didn’t take off the CRWD put spreads they are now worth 0.17 – this would still be solid profit if you want to take them off and reduce risk given the down trend in the stock. CRWD is at 171 and our short strike is $31 away – but CRWD also dropped $20 last week so it can definitely move $31 more in 2 weeks. I do have my position on still and will look to close cheaply this week. I always prepare to keep a trade on for the full duration, recognizing I may not get to it during the work week.
Our SPY call spreads look great, worth 0.16 at this point. They can be taken off any time to bank the profits. I’ll hold probably through this week at least, would happily close for 0.05.
9/24/2022 Update:
Feel free to close the SPY call spreads at any time given they are near max profit. I’ll be closing the short leg for 0.02 or 0.03 Monday. I’ll leave the long leg on as a true “lottery ticket”
The CRWD put spreads are worth 0.17 (still) and can be closed any time this week. Reminder that they expire on Friday. Don’t let it turn into a loss in these volatile markets.
10/9/2022 Close:
The CRWD put spreads expired worthless on 9/30/2022 giving us a $47 credit per put spread sold. Nice.
The SPY Call spreads expired worthless on 10/7, adding $48 per put spread sold to our accounts.
