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.
Tech Alert - (FISV) – BUY
BUY Fiserv, Inc. (FISV) October 2019 $90-$95 in-the-money vertical BULL CALL spread at $4.40 up to $4.45
Opening Trade
10-2-2019
expiration date: October 18, 2019
Portfolio weighting: 10%
Number of Contracts = 23 contracts
Fiserv, Inc. (FISV), together with its subsidiaries, provides account and billing financial services technology worldwide and is as stable as they come.
The stock is down almost 3% as economic indicators continue to tank the broader market.
This is a short term bet that the underlying stock will stay above $95 in the next 17 days.
The company is extremely profitable and has a bullet proof balance sheet. These are the types of tech stocks the market is putting a higher multiple on as the market has shifted the last few weeks.
I believe FISV will be able to withstand the external pressure that is penalizing fringe tech stocks then the real deal type of stocks.
Traders must be extraordinarily nimble in precarious trading times like now.
If you don’t do options, then stand aside for the next trade.
Buy 23 October 2019 (FISV) $90 calls at………….………$10.85
Sell short 23 October 2019 (FISV) $95 calls at….……….$6.45
Net Cost:……………………..…….………..…….....................$4.40
Potential Profit: $5.00 - $4.40 = $0.60
(23 X 100 X $0.60) = $1,380 or 13.80% in 17 days.
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.
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.
