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 - (GS) - BUY
BUY the Goldman Sachs (GS) September, 2017 $205-$210 in-the-money vertical bull call spread at $4.40 or best
Opening Trade
8-17-2017
expiration date: September 15, 2017
Portfolio weighting: 10%
Number of Contracts = 23 contracts
I am going to use the dip in Goldman Sachs today to jump back into the banks and buy a position in the Goldman Sachs (GS) September 2017 $205-$210 in-the-money vertical bull call spread at $4.40 or best.
This is a bet that (GS) will not trade below $210 by the September 15 expiration in 20 trading days.
The options market is more illiquid than usual today and trading spreads are wide. Don't pay more than $4.60 for the spread or you'll be taking on too much risk.
If you can't buy options I think its pretty safe to buy the stock on a medium term view.
After six months of hibernation, I think the banks are about to make a move.
Interest in buying technology stocks, up 40% of the year, is waning making the sector ripe for a rotation.
A long in Goldman Sachs would be a nice hedge against any such rapid sector rotation
As our profitable short position in the US Treasury bond market (TLT) is screaming at us, the bond market may have peaked for the year this week, and financials love rising rates.
Banks also passed their stress test with flying colors. They are now well capitalized enough to handle TWO 2008 type financial crisis.
This is the Federal Reserve's the Comprehensive Capital Analysis and Review, otherwise known as CCAR.
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 http://members.
You must be logged into your account to view the video.
Please keep in mind that these are ballpark prices only. There is no telling how much the market can move by the time you get this.
Be sure you've signed up for our FREE text alert service. When seconds count, this feature offers a trading advantage. In today's market, investors need every advantage they can get.
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.
If you don't get done, don't worry. There are another 250 Trade Alerts coming at you over the coming 12 months.
Here are the specific trades you need to execute this position:
Buy 23 September, 2017 (GS) $205 calls at...................................................$19.60
Sell short 23 September, 2017 (GS) $210 calls at..................................$15.20
Net Cost:................................................................................................................
Potential Profit: $5.00 - $4.40 = $0.60
(23 X 100 X $0.60) = $1,380 or 13.63% profit in 20 trading days.
