Truly a Crushing Blow: Take Put Profits

How to Gain While Everyone Else is Getting Killed

By Bryan Bottarelli
Tuesday, February 27, 2007 2:27 PM EST
Tue, 27 Feb 2007 19:27:00 GMT

Dear Bottarelli Research Member,

I hope you’re seeing the absolute beauty of owning put options on a day like today.

As I write, the Dow is now down 217 points — and our put options are blasting aggressively higher. Your DIA March 126 Puts (DAW OV), for example, have traded as high as $2.85 today, good for a nice 103% gainer. If you know me, that’s certainly enough to lock in profits, so let’s use today’s crushing downside pressure to lock in our triple-digit gains!

DIA

But instead of taking profits on the entire position, I’d like to take profits on HALF. That way, you can lock in your gains while still having protective downside exposure.

PLAY: Sell Half of your DIA March 126 Puts (DAW OV) at or above $2.70, good for the day.

At the same time, let’s lock in profits on Cognizant Technology (CTSH – NASDAQ).The CTSH April 90 Puts (UPU PR) that we entered this morning for $2.65 have traded as high as $3.80, good for a one-day gain of 43.39%. Lock in your profits now!

CTSH

PLAY: Sell your CTSH April 90 Puts (UPU PR) at or above $3.70, good for the day.

And once again, congrats on locking in winners on such a tremendous market down-day. Not many recreational investors are capable of doing this — and I’m sure glad you’re part of my elite group of traders. So as always…

Lock and load!

Sincerely,

Bryan Bottarelli

Bryan Bottarelli
Editor, Bottarelli Research

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