XRT Put Spread

Valentine’s Day rivals New Year’s Eve as the most fraught holiday because success is based largely on other people. Any small error with the date, the sentiment, and/or the gift, and you end up in the doghouse. Well, at least your dog likes you. Just don’t give him chocolate. Of course, Valentine’s is just another excuse to spend money on stuff, which could be why XRT, the retail ETF, made a new high for 2019 yesterday. XRT is up 9.5% in 2019, but most of that came in the first week of the year and it’s been relatively flat ever since. It’s also been underperforming the broader market. If the market does sell off, the weaker XRT could lead the way down. If you’re bearish on XRT, the long put vertical that’s short the 44.5 put and long the 46 put in the March weekly expiration with 43 DTE is a bearish strategy that has a 64% prob of making 50% of its max profit before expiry and that generates $.13 of positive daily theta.

This Trade Is

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