Sunday Night Weekly Review with Options Trades SEP 15, 2024

How was your weekend? Did you get outside in nature and stretch your legs? I’m hoping you did, it was great weather for it here in the Midwest.

On Friday we talked a lot about CAT and Options on it. Tonight I’m going to share a “Deep Dive” into the 3 separate trades that we placed on Friday to offer you a glimpse of what is possible with Options

1st: Blind Calls
We bought 5 contracts that were ATM or the 340 Strike
Those 5 contracts cost us a total of $7,450.00 for the OCT 18, 2024 expiration
Had we of bought 500 shares ( One contract equals 100 shares ) outright it would of cost us $170,000.00
Those 5 Calls are currently up 3.36% or $250.00
We did not buy at the open but rather after the price had already moved up 1% and at 130pm EST. The price closed up 1.6% on the day
Those are shown on the 3rd line down of the 4
There is no cap on this trade, and the profits will grow rapidly with any positive price movement

2nd: Bull Call Spreads
First you will see 10 contracts at the 350 Strike on the 2nd line
5 of those contracts belong to this trade
There we bought those 5 contracts for $3,400.00
We then sold 5 contracts at the 370 strike collecting a premium $1,295.00
That made the total cost of our Bull Call Spreads $2,105.00
As of Friday at the close we were up $1,270.00
That is a 65.75% gain in one day
One thing of importance, those will cap out if price hits 370
When you look at the chart of CAT you will see that 370 is at the top of it’s box
It’s also where there’s very strong Options interest for our EXP date of OCT 18, 2024

3rd: Calendar Spreads
On this particular trade we might as well rename this spread here “Free Money”
What we now need to do is go back to the 2nd line, and take the 2nd ½ of those 350’s
We already know that we bought 5 contracts for $3,400.00 and they are now up $1,400.00
We then subtract the $202.00 from the 4th line ( those are the Weekly Shorts that we are collecting Premium on each week as allow our Monthly 350’s to grow )
If the price of CAT doesn’t exceed above $350.00 by next Friday SEP 20, 2024, we will collect $264.00 in the bank. If does go north of $350.00 no worries, we simply adjust, that’s not an issue for us here
We still get to keep the $350’s that we bought, which again, are already up $1,400.00
But now we sell the higher strike again for the following Friday. This is an income generation play. This is not day trading, Calendar Spreads are for investors. This is wash, rinse and repeat. If you need additional help understanding this one just wait until next Friday after the close, then you can see how we profited.

In a nutshell for all of these trades what we laid out on Friday was $11,632.00
We are currently green being up $2,719.00
That is a 23.37% gain in literally ½ of a trading day
Seeing as how 2 of the 3 trades had downside protection, or “insurance” added on, and we only had 0.5% movement in the stock after we bought, yeahhhh ,, ummmmm I’d say Friday was a good day
Had we of laid out our $11,632.00 and just bought the common stock, our gain on Friday would of only been $58.16

The difference between being up $2,719.00 VS only $58.16 is 4,575%
If that’s not food for thought I don’t know what is
Like anything else in life it’s when preparation meets opportunity that creates success
We’ve been watching CAT for a while, this isn’t our first mention of it
But it took until now to offer us the Options Values combined with where it is on the chart for our desired entry point
If CAT were to fall off a cliff tomorrow we would obviously have to exit our Blind Calls quickly, that’s called Trade Management. The fact that we bought when IV was favorable is on our side
The Bull Call Spreads that we have are capped to any potential loss, and actually would still produce a small gain before exiting if we had to
The Calendar Spreads? Those are covered, that’s why they’re suited for investors and not day trading. You won’t get rich quick with them, but you can build steady passive income while you sleep

When we roll out the the Premium Service here at theoptionscoach.net these will be the types of investments we will be sharing.
For anyone wondering, no, no you do not have to put all 3 on at the same time. They are 3 separate investments
I did this in my own personal account to illustrate and share with all of you the power of Options.
Also I plan to show these trades progress along the way until exit

All of our stocks did well this week
GE +10.57%
SFM +3.31%
SN +9.02% 😁 😁 😁 😁 😁 
GD +4.11%
NVDA +15.83%
AMZN 8.5%
The list goes on, you see the green

If History holds true and the last 2 weeks of SEP are the hardest, the bears are going to have to work overtime to knock this market back down again

See you in the morning
The Options Coach