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 - (GILD)
Buy the Gilead Sciences (GILD) November, 2014 $80-$85 deep in-the-money vertical bull call spread at $3.65 or best
Opening Trade
10-16-2014
expiration date: November 21, 2014
Portfolio weighting: 10%
Number of Contracts = 27 contracts
I?m sorry, but I haven?t been able to execute a 15%-10% deep in the money call spread one month out and reap a 3.65% return in many years, so I?ll got to do this.
You can buy this spread anywhere in a $3.60-$4.00 range and have a reasonable expectation of making good money on this trade.
For those who can't do options buy the stock outright at market price - portfolio weighting 10%.
This is a stock that could double by the end of 2015. More research to follow.
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 farther out.
Here are the specific trades you need to execute this position:
Buy 27 November, 2014 (GILD) $80 calls at?????$15.80
Sell short 27 November, 2014 (GILD) $85 calls at..??.$12.15
Net Cost:??????????????????.....$3.65
Potential Profit at expiration: $5.00 - $3.65 = $1.35
(27 X 100 X $1.35) = $3.65 or 2.04% profit for the notional $100,000 portfolio.
