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How to Manage and Close the Super Bear Trade

NowPress play to follow along0:00 / 10:15
Chapters5 segments · tap to seek
ticker lesson

Breakdown

0:00lesson

Managing a super bear strategy after initiation

  • Final step in super bear strategy is managing the trade
  • Essential to know how to close and adjust
  • Decisions depend on market movement and portfolio
  • Trader discretion on holding or closing the trade
1:47SPX· ticker

Super bear trade example with October 21st expiration

  • Sold 7740-7750 call spread for 76.85
  • 30 cent credit received
  • Market down, trade shows $1,000 profit
  • Potential $1,900 return if closed
3:35lesson

Trader discretion in closing super bear trades

  • Closing depends on trader's risk tolerance
  • High return on capital possible (over 200%)
  • Still exposed if only closing call spread
  • Best to close entire trade for fresh perspective
5:13SPX· ticker

Super bear trade with $20 wide put spread

  • Potential $230 profit if below 7665
  • Max loss $970 if trade goes in the money
  • Cash settled, no assignment risk
  • Losses are taken out of account
7:16SPX· ticker

Further out super bear trade with 70 cent credit

  • 7855-7865 call spread sold for 70 cents
  • Market move reduced profit potential
  • Wider strikes don't guarantee more money
  • Risk-reward differs between expirations

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