Option Investor
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WE'RE OUT

HAVING TROUBLE PRINTING?
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-- AND SAFE! Hi Team,

We were able to exit the November SPX 1235/1245 bear call spread this morning. After the initial open, the market pulled back slightly and we bought back 15 contracts of the 1235 call for $2.50 and sold our 15 contracts of the 1245 call for $.35. Our debit was $2.15.

Originally, we had taken in $1.25 in premium. That leaves us with a net debit on the spread of ($2.15 - $1.25 = $.90 X 15 contracts = $1,350.

It's worth the $1,350 not to be exposed for the next two days. It's possible that the market will pull back and this move might not have been necessary. But, I felt it was the prudent thing to do. Every trader has to make that decision - weighing the potential grief against taking a relatively small loss. It's an individual decision.

Good luck and trade smart.

Mike

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