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NEW POSITION OCT. CPTI PORTFOLIO

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NEW OCT. CPTI PORTFOLIO POSITIONHi Gang,

Here we go again. You know how I like to trade on Fridays. NOW PAY CLOSE ATTENTION. The number of contracts on the two spreads are NOT THE SAME. You will likely have to put the spread orders in separately. Last time we did this, there was mass confusion. If you have questions, refer back to my explanation of this in last month's columns. I'm trading less contracts in the bear call spread to have less exposure on the topside.

With the RUT at about 707:

Sell 15 October RUT 630 puts - RUYVF
Buy 15 October RUT 620 puts - RUYVD
Credit of about $.60 ($900)

Sell 10 October RUT 770 calls - RUTJN
Buy 10 October RUT 780 calls - RUTJP
Credit of about $.75 ($750)

Potential profit is $1,650. Maintenance is $15,000 (the higher of the two spreads). The maximum profit range is 630 to 770 = 140 points.

Remember, these are suggestions. Adjust the number of contracts to your account size and/or your comfort level. Be flexible, be creative, but don't get greedy.

Good luck and trade smart!!

Mike

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