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) August 2021 $355-$365 in-the-money vertical Bull Call spread at $8.60 or best
Opening Trade
8-4-2021
expiration date: August 20, 2021
Portfolio weighting: 10%
Number of Contracts = 12 contracts
If you don’t do options, buy the stock. My target for (GS) this year is $400, up 45%.
In addition, my own Mad Hedge Market Timing Index is strongly in “BUY” territory at 28. This is the lowest level since before the presidential election eight months ago.
I am therefore buying the Goldman Sachs (GS) August 2021 $355-$365 in-the-money vertical Bull Call spread at $8.60 or best
Don’t pay more than $9.30 or you’ll be chasing.
Goldman Sachs (GS) announced blockbuster earnings last week and the shares sold off big. It was a classic “Buy the rumor, sell the news” type move.
That has given us a gift. (GS) is the second-best company in the global brokerage sector, right after Morgan Stanley (MS).
I believe that massive government borrowing and spending will drive US interest rates up through the roof and the value of the US dollar (UUP) down. Banks love high interest rates because they vastly improve profit margins.
Covid-19 is rapidly approaching its fourth peak with the delta virus. Total US deaths could exceed the 1919 Spanish Flu 625,000 peak by the fall. We passed all WWII deaths ages ago.
This is a bet that Goldman Sachs (GS) will not fall below $365 by the August 20 option expiration day in 12 trading days.
Here are the specific trades you need to execute this position:
Buy 12 August 2021 (GS) $355 calls at………….………$26.00
Sell short 12 August 2021 (GS) $365 calls at………....$17.40
Net Cost:……………………..…….………..…....……….….....$8.60
Potential Profit: $10.00 - $8.60 = $1.40
(12 X 100 X $1.40) = $1, 680 or 16.27% in 12 trading days.
If you are uncertain about how to execute an options spread, please watch my training video 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.
