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Over the 64 trades in the model portfolio – 71.88% were profitable.

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Kyle Dennis Biotech Nucleus | This Bullish Strategy Makes Money 3 Ways

With stocks brushing up against all-time highs… it’s become harder and harder to find value in the market. However, that is where turning to options can become advantageous.

You see, with options trading the possibilities are endless. For example, if you are bullish a stock… the only way to play it with equities… is to buy shares.

However, I’m about to introduce you to a bullish options strategy, that allows you:

  • Profit if the stock rises
  • Profit if the stock barely moves
  • Profit if the stock drops slightly lower

It’s not bulletproof, but as you can see, it offers more opportunities to win. And that’s always a good thing to have as a trader.

Now, unlike most options strategies, this one is simple and straightforward. But despite that, you’d be surprised at how overlooked it is. However, I just closed out a winning trade, utilizing the strategy.

Contents

  • 1 Making Money in A Stock… Before You Buy Shares
  • 2 Advantages of Short Put Strategy
  • 3 Using the Short Put Strategy – Case Study

Making Money in A Stock… Before You Buy Shares

What if I told you there was a way to make money in a stock before you buy any shares?

You’re probably thinking it’s too good to be true…

… but it’s not.

You see, I’m talking about naked selling put options.

If you don’t know, when you short put options… you’re able to collect premium as long as the stock stays above the strike price that you sold.

However, if the stock actually falls below the strike price and expires in the money… you’re obligated to buy shares of the stock at the strike price.

Now, the strategy has downside risk… and your maximum reward is limited to the premium collected.

For example, let’s say you sell five $25 strike price puts in a stock for $0.50… and let’s say it closed at $24.75 on the expiration date. Well, you collect a premium of $250 (100 * 0.50 * 5) from the start.

Thereafter, you would be long 500 shares at $25 (you’re obligated to buy shares if the option expires in the money).

With that said, you can make money in a stock before you buy it… and selling put options has many advantages.

So when would anyone want to use this strategy?

Well, if you’re bullish on a stock and willing to own it at a specific price… it may make sense to use the strategy.

If you think the stock will stay above a certain level or have neutral trading activity… the strategy could be powerful.

Advantages of Short Put Strategy

With this strategy, the advantages outweigh the disadvantages.

Advantages Disadvantages
Time decay
Downside risk if the options expire in the money and the stock sells off after.
Multiple scenarios to profit
Requires less capital than buying stock outright
Can generate income

You see, when you sell options… time is on your side. You can read more about how time decay benefits options sellers here.

There are actually multiple ways to profit from a short put. If the stock gains in value, moves sideways, or just drops a little bit… you make money. Just as long as the stock is above the strike price, you’re in the clear.

When you buy shares… you actually have to put the money upfront. Think about buying 1,000 shares of a $20 stock… that’ll cost you $20,000.

However, if you sell 10 put options (options have a 100 multiplier) – which would control 1,000 shares – to establish your bullish position… it won’t use as much capital as just buying stock outright.

Not only that, it could be a way to generate income on the sign.

Now, here’s how I use the strategy.

Using the Short Put Strategy – Case Study

If I’m bullish on a stock… and willing to own shares at a specific level… I may look to sell puts.

For example, here’s a look at the daily chart in Amarin Corp. (AMRN).

The stock has sold off due to a secondary offering, which was priced at $18. Keep in mind, secondary offerings dilute the stock and cause selloffs. However, if you look at the chart above, $18 is a clear support level.

What that means to me is that there is demand at that level, and traders are likely to buy the stock around $18. That said, it had a high probability of rebounding from that level. As you can see, the stock just broke slightly below $18 before closing around $18.50.

Rather than buying the stock outright and having to use a lot of my capital… I decided to sell puts, and of course, I let my clients know about it.

Now, I sold the $17.50 puts in AMRN for $0.52. That means as long as the stock stayed above $17.50… I would collect all the premium. However, if the stock closed below $17.50 on the expiration date… I would have to buy shares at that price.

But what happens if you change your mind and don’t want to own at $17.50 anymore.

Well, you can actually close out the position and lock in a winner… and generate some income.

That’s exactly what I did with AMRN.

Why?

The stock is reporting earnings next week… and I don’t want to hold this position into that volatile event.

You see, if the stock misses expectations… I don’t want to own the stock at $17.50 anymore because it could be trading well below that after earnings, and those options expire a few days after its earnings announcement.

By closing out the position, I locked in around 50% on the trade… and minimize my risk.

Now, if you’re interested in learning how to use multiple strategies to improve your chances of beating the market… and find clarity amongst all the chaos in the market… then you’ll want to check out this video lesson on my latest trading system – what I call Black Options.

However, you’ll have to hurry because I’m only allowing a handful of people to sit in on the session. Click here to register.

[Ed.note: Kyle Dennis runs BiotechBreakouts.com. He is an event-based trader, who prefers low-priced and small-cap biotech stocks.

To learn more JOIN THIS SPECIAL ONLINE EVENT: 3-Step Plan Kyle Used to Turn $15,253 into $2,855,475 and download his FREE “The $2.9 Million Biotech Trader Playbook here!]

Source: BiotechBreakouts.com | Original Link

Author John GladstonPosted on July 25, 2019Categories Kyle Dennis Biotech BreakoutsTags $100k Heist Live Event Kyle Dennis, $100k Heist Webinar Kyle Dennis, $100k Heist Webinar Registration Page, $100k Heist Webinar with Kyle Dennis, Biotech Breakouts, biotech breakouts kyle dennis review, biotech breakouts login, Biotech Breakouts Review, Biotech Breakouts reviews, Biotech Breakouts scam, Biotech Breakouts Stock Alerts Service Review, Biotech Breakouts Stock Alerts Service Scam, Biotech Nucleus, Biotech Nucleus Cost, Biotech Nucleus Customer Review, Biotech Nucleus Good, Biotech Nucleus Kyle, Biotech Nucleus Kyle Dennis, Biotech Nucleus Legit, Biotech Nucleus Real Member Review, Biotech Nucleus Review, Biotech Nucleus Reviews, Biotech Nucleus Scam, Biotech Nucleus User experience, Black Optics Review, Black Optics Reviews, Black Optics Scam, Black Optics Trading Program, Black Optics Trading Strategy, Black Optics Trading System, FDA Insider & Lightning Alerts, FDA Insider & Lightning Alerts Kyle Dennis, FDA Insider & Lightning Alerts Review, FDA Insider & Lightning Alerts Reviews, FDA Insider & Lightning Alerts Scam, FDA Insider Alert Free, FDA Insider Alert review, FDA Insider Alert reviews, FDA Insider Alert scam, fda insider alerts, Fortune Forecaster, Fortune Forecaster Complaints, Fortune Forecaster Discount, Fortune Forecaster Fraud, Fortune Forecaster Login, Fortune Forecaster Performance, Fortune Forecaster Price, Fortune Forecaster Real User Review, Fortune Forecaster Refund, Fortune Forecaster Results, Fortune Forecaster Review, Fortune Forecaster Reviews, Fortune Forecaster Sale, Fortune Forecaster Scam, Fortune Forecaster Stock Gumshoe, Fortune Forecaster Strategy, Fortune Forecaster Strategy Review, Fortune Forecaster Strategy Reviews, Fortune Forecaster Strategy Scam, Fortune Forecaster Website, How to turn $5K into $100K, How YOU Could "Steal" $100k From Wall Street, I.G.N.I.T.E., I.G.N.I.T.E. Options Kyle Dennis, I.G.N.I.T.E. Options Strategy, I.G.N.I.T.E. Options Strategy Kyle Dennis, I.G.N.I.T.E. Review, Join The Heist, kyle biotech breakouts, Kyle Dennis, Kyle Dennis Black Optics, Kyle Dennis Black Optics Complaints, Kyle Dennis Black Optics Fraud, Kyle Dennis Black Optics Login, Kyle Dennis Black Optics Performance, Kyle Dennis Black Optics Program, Kyle Dennis Black Optics Refund, Kyle Dennis Black Optics Results, Kyle Dennis Black Optics Review, Kyle Dennis Black Optics Reviews, Kyle Dennis Black Optics Scam, Kyle Dennis Black Optics System, Kyle Dennis Black Optics Website, Kyle Dennis FDA Insider & Lightning Alerts, Kyle Dennis FDA Insider & Lightning Alerts Review, Kyle Dennis FDA Insider & Lightning Alerts Scam, Kyle Dennis FDA Insider Alert review, Kyle Dennis fda insider alerts, Kyle Dennis fda insider alerts review, Kyle Dennis fda insider alerts scam, Kyle Dennis Fortune Forecaster, Kyle Dennis Fortune Forecaster Review, Kyle Dennis Fortune Forecaster Reviews, Kyle Dennis Fortune Forecaster Scam, Kyle Dennis lightning alerts, Kyle Dennis lightning alerts review, Kyle Dennis lightning alerts scam, Kyle Dennis review, Kyle Dennis scam, Kyle Dennis Stocks, Kyle Dennis Stocks review, Kyle Dennis Stocks scam, Lightning Alerts Free, Lightning Alerts Review, Lightning Alerts Reviews, Lightning Alerts Scam, Middle-Class Millionaire Kyle Dennis, Middle-Class Millionaire: From $80K in Debt to $3M in Profits through Catalyst Trading, Option Rocket Kyle Dennis, Option Rocket Review, Option Rocket Reviews, Option Rocket Scam, Options Rocket Kyle Dennis, Options Rocket login, Options Rocket Review, Options Rocket Reviews, Options Rocket Scam, Options Rocket User experience, Options Rocket user review, Options Rocket webinar, Options Rocket website, RagingBull Fortune Forecaster, RagingBull Fortune Forecaster Review, RagingBull Fortune Forecaster Reviews, RagingBull Fortune Forecaster Scam, The Heist, The Heist Kyle Dennis, The Heist Review, The Heist Scam

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