How To Sell Vertical Puts (Strategy) - $3,000+ Profit Within 6 Hours

Selling vertical puts can be a great strategy that will pay out anywhere between 10-40% returns on your risk. Here are a few examples. $TSLA Vertical Put -700P/+690P We will sell $700 put and buy $690 put, this is a spread of $10 dollars which is your max risk minus the credit you receive which in this example will pretend will be $2, which gives us around 20% returns. Our goal is to keep $TSLA above $700 dollars if it goes below we can take a loss of up to $8 dollars per contract.


$SPY Vertical Put -285/+284P on 3/6 (Actual Trade From Today)

Here is another example of a trade we took today, sold $SPY 285 and bought $284. I took 100 contracts for a risk of $8700 to gain $1300 dollars around a 15% return, and it expires the same day. The chance of $SPY closing more than 5% was going to be near impossible so we took the risk and took this trade. We added to this trade and took another 100 contracts at -$287/+287 for 115 contracts which netted another $2500+ profit!


Why do this on a Friday morning? It's easier to predict what the closing price on a single day is than trying to estimate what the price will be a few days out where a stock can gap up or down. The biggest issue in this strategy is a gap. Thus the reason why I tend to sell the largest positions on a Friday morning (usually 1-2 hours after open). You can adjust the position and/or close the position as well for a much smaller loss as well if you need to while the market is open compared to taking a max loss.

Closing Positions?

I do not close the positions if I'm in profit at the end of the day (we let them expire worthless, both legs) unless the TSLA, in this case, is at $701 - since options can be exercised up to 1 hour after close this can go in the money, so I would rather close it and not take a risk, I will still be in profit but not 100%.


If you're looking to learn more and join our live trading group come check us out! Click Join Now, we have a special of $149 for all of 2020 - offer ends soon! Special Offer $149 For Full Access in 2020 Worth The Education and Live Trading Group

0 views
Get Alerts On Our Blog

© 2019 by Pineapple Stocks LLC. AZ: 1990944 Copyright Reserved

Once again, we stress the importance of understanding all of the risks of any form of trading or investing that you choose to do. One should fully understand the worst-case scenario prior to trading or investing real dollars. Past performance is not necessarily indicative of future results. You take full responsibility for all trading actions and should make every effort to understand the risks involved. Pineapple Stocks LLC. is not responsible for any losses that may occur from trading our opinions. You must take on your own due diligence.  
Please read our terms and conditions. By subscribing, joining or purchasing a membership you are agreeing to all terms and conditions.
View our terms and conditions under Plans pages. SMS alerts may have additional fees.