While the Diary of a Mad Hedge Fund Trader focuses on investment over a one week to the six-month time frame, Mad Day Trader, provided by Bill Davis, will exploit money-making opportunities over a brief ten minute to three-day window. It is ideally suited for day traders, but can also be used by long-term investors to improve market timing for entry and exit points.
I would like to make a suggestion today to buy a stock. That stock is Clearwater Paper Corp. (CLW).
CLW has sold off and I do believe it is bottoming out.
But, I am not going to suggest you buy the stock.
Instead, I will suggest a debit spread.
Here is the idea:
Buy to Open - May - $20.00 call for $2.00
Sell to Open - May - $22.50 call for $1.00
The net debit will be $1.00 per spread with a maximum return of 1.50 per spread.
Limit the buy in to a 6 lot or 0.6% of the nominal portfolio.