As a potentially profitable opportunity presents itself, John will send you an alert with specific trade information as to what should be bought, when to buy it, and at what price. This is your chance to ?look over? John Thomas? shoulder as he gives you unparalleled insight on major world financial trends BEFORE they happen.
Trade Alert - (QCOM)
Buy the QUALCOMM (QCOM) February, 2015 $75-$80 in-the-money bear put spread at $4.05 or best
Opening Trade
1-20-2015
expiration date: February 20, 2015
Portfolio weighting: 10%
Number of Contracts = 25 contracts
Guess which company has the highest exposure to foreign earnings among the S&P 500, and therefore the biggest drag on earnings presented by a strong dollar?
QUALCOMM (QCOM). The San Diego based maker of processors for cell phones, tablets, and laptops gets 97% of is revenues from abroad. That makes the company a great short during a period of perennial dollar strong.
You can buy the QUALCOMM (QCOM) February, 2015 $75-$80 in-the-money bear put spread anywhere in the $4.00 to $4.50 range an have a good chance of making money.
If you can?t do the options, stand aside, as the risk reward on a pure equity trade is not that attractive.
Keep in mind that the options market is highly illiquid now, so don?t hold me to these prices. They are ballpark estimates, at best.
The best execution can be had by placing your bid for the entire spread in the middle market and waiting for the market to come to you. The difference between the bid and the offer on these deep in-the-money spread trades can be enormous.
Don?t execute the legs individually or you will end up losing much of your profit. Spread pricing can be very volatile on expiration months farther out.
If the price of this spread has moved more than 5% by the time you receive this Trade Alert, don?t chase it. Wait for the next one. There are plenty of fish in the sea.
Here are the specific trades you need to execute this position:
Buy 25 February, 2015 (QCOM) $80 puts at?????$8.80
Sell short 25 February, 2015 (QCOM) $75 puts at..??.$4.75
Net Cost:??????????????????.....$4.05
Potential Profit: $5.00 - $4.05 = $0.95
(25 X 100 X $0.95) = $2,375 or 2.28% profit for the notional $100,000 portfolio.
