When John identifies a strategic exit point, he will send you an alert with specific trade information as to what security to sell, when to sell it, and at what price. Most often, it will be to TAKE PROFITS, but, on rare occasions, it will be to exercise a STOP LOSS at a predetermined price to adhere to strict risk management discipline.
Trade Alert - (ABX)- STOP LOSS
SELL the Barrick Gold (ABX) October, 2017 $15-$16 in-the-money vertical BULL CALL spread at $0.81 or best
Closing Trade
9-21-2017
expiration date: October 20, 2017
Portfolio weighting: 10%
Number of Contracts = 112 contracts
Janet Yellen's decision yesterday cut the knees out from under the gold trade, at least for the short term.
She didn't raise rates, which is gold positive.
However, she did produce a firm timetable for when the Fed will sell its massive $4 trillion bond hoard, some $6 billion a month.
That is very gold negative. It is also terrible news for gold and silver miners and bonds of every description.
So I am going to stop out here with a small loss in my position in the Barrick Gold (ABX) October, 2017 $15-$16 in-the-money vertical BULL CALL spread at $0.81 or best.
Better to eliminate my risk and live to fight another day until this cat among the pigeons sorts itself out.
This is why I took profits in my other four positions in precious metals three weeks ago.
To see how to enter this trade in your online platform, please look at the order ticket below, which I pulled off of Interactive Brokers.
If you are uncertain on how to execute an options spread, please watch my training video on How to Execute a Vertical Bull Call Spread by clicking here at
http://members.
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.
Keep in mind that these are ballpark prices at best. After the alerts go out, prices can be all over the map.
Here are the specific trades you need to execute this position:
Sell 112 October, 2017 (ABX) $15 calls at.......................................$1.55
Buy short 112 October, 2017 (ABX) $16 calls at.........................$0.74
Net Proceeds:............................................................................$0.81
Loss: $0.88 - $0.81 = -$0.09
(112 X 100 X -$0.09) = $1,008 or 11.11% in 5 trading days.
