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 - (JPM)
Sell the JP Morgan (JPM) July, 2014 $52.50-$55 in-the-money bull call spread at $2.47 or best
Closing Trade
6-23-2014
expiration date: July 18, 2014
Portfolio weighting: 10%
Number of Contracts = 49 contracts
We?ve got 85% of the potential profit here. This is also our position with the closest strike prices that will feel the most heat in any pull back. Time to go on vacation!
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.
If the price of this spread has moved more than 5% by the time you receive this Trade Alert, don?t chase it. Wait for the next one. There are plenty of fish in the sea.
Here are the specific trades you need to execute this position:
Sell 49 July, 2014 (JPM) $52.50 calls at?????$5.50
Buy to cover short 49 July, 2014 (JPM) $55 calls at..??.$3.03
Net Cost:??????????????????.....$2.47
Profit: $2.47 - $2.10 = $0.37
(49 X 100 X $0.37) = $1,833 or 1.83% profit for the notional $100,000 portfolio.
