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.
Trade Alert - (BAC)
Sell the Bank of America (BAC) March, 2014 $15-$16 bull call spread at $0.98 or best
Closing Trade
3-6-2014
expiration date: 3-21-2014
Portfolio weighting: 10%
Number of Contracts = 116 contracts
A 14% profit in eight trading days works for me. At this level we have squeezed out 86% of the potential profit from the Bank of America March, 2014 $15-$16 bull call spread. That drops $1,392, or 1.39% straight to the bottom line for our model trading portfolio.
I think that a major breakout in the banks is underway. The sideways moving apex on the charts did prove to be the springboard for the next move, as I expected. So I will roll up and out on the next (BAC) call spread. Watch for the next Trade Alert.
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.
Keep in mind that these are ballpark prices only. Spread pricing can be very volatile on expiration months further out.
Here are the specific trades you need to execute this position:
Sell 116 March, 2014 (BAC) $15 calls at??????.?.$2.49
Buy to cover short 116 March, 2014 (BAC) $16 calls at?$1.51
Net Cost:????????????....?...?......$0.98
Profit: $0.98 - $0.86 = $0.12
($0.12 X 100 X 116) = $1,392 ? 1.39% for the notional $100,000 model portfolio.
