Rocket - PYPL Update - Place Order to Close 11-03-20
Place order to close PYPL put credit spread at $1.35
We're going to place an order to close our position. PYPL has traded from $176 to above $188 today, and is now back at $184.14.
We received a $2.35 credit when initiating this trade. Place an order to close this spread for a debit (cost) of $1.35. PYPL has to trade a little higher from where it is now to get executed. If we don't get executed then we'll hold through the election.
By choosing to attempt to exit the trade at $1.35, we're essentially saying we don't want to keep the remaining $615 at risk for the additional $135 in profit potential, if we get executed at that price.
As the price of PYPL goes up, the cost of closing this trade goes down (and visa versa).
To close the trade: you are buying the $180 put and selling the $172.50 put, resulting in a debit of $1.35 or less. For those new to multi-leg options, most platforms have an option to close trade as one single order.
We received a $2.35 credit when initiating this trade. Place an order to close this spread for a debit (cost) of $1.35. PYPL has to trade a little higher from where it is now to get executed. If we don't get executed then we'll hold through the election.
By choosing to attempt to exit the trade at $1.35, we're essentially saying we don't want to keep the remaining $615 at risk for the additional $135 in profit potential, if we get executed at that price.
As the price of PYPL goes up, the cost of closing this trade goes down (and visa versa).
To close the trade: you are buying the $180 put and selling the $172.50 put, resulting in a debit of $1.35 or less. For those new to multi-leg options, most platforms have an option to close trade as one single order.
